in Indonesia, Norway, West Papua

Interview with Kuntoro Mangkusubroto, head of Indonesia’s REDD+ Task Force: “We are starting a new programme, a new paradigm, a new concept, a new way of seeing things”

Interview with Kuntoro Mangkusubroto, head of Indonesia’s REDD+ Task Force. Jakarta, May 2012. A second interview followed with Heru Prasetyo, Deputy I UKP4 and a member of the REDD+ Task Force[*], in July 2012.

REDD-Monitor: Can you start with some background about your work with the UKP4 (Presidential Working Unit for Supervision and Management of Development) and the REDD+ Task Force.

Kuntoro Mangkusubroto: UKP4 is basically a working unit, responsible and reporting only to the President. It’s part of the whole President’s Office. It’s just like the West Wing in the US. It’s unprecedented in Indonesia. The President hasn’t had this unit before. It was established at the same time as the cabinet, in October 2009. The unit monitors and gives the President input and evaluation with regard to the performance of the cabinet, of the common programme, and the regions. So it covers a very wide area.

Along the way the President has added more functions. There used to be another Task Force on Judicial Mafia Eradication. That task force has not been there for two years. But the function is incorporated within this unit. So this unit that has a function of monitoring now has another function.

The unit also assists the President in trying to find ways out of bottlenecks: Major strategic programmes, oil and gas, the Java toll road, logistics systems, energy, power plants, you name it.

After the Letter of Intent with Norway was signed, the President created another task force, the REDD+ Task Force especially to implement the LoI between Indonesia and Norway. So basically that is the scope of this unit. It’s a very flexible unit.

At the beginning, I had four deputies. Along the way, additional deputies were added. Now we have six, in charge of different issues. This unit is basically a unit of the President, to serve the President, and if there’s anything the President feels is necessary for him to add or amend, he does so. That’s necessary for him to be more effective as a President.

It’s a very small unit, consisting of less than 30 people, but supported by a number of expert groups. For instance on REDD+, I have a very small team here, but in addition to that we have ten working groups, to come up with new approaches, a work programme and the structure that’s necessary for REDD+ to be implemented successfully.

REDD-Monitor: Could you say a little bit about how the working groups work?

Kuntoro Mangkusubroto

Kuntoro Mangkusubroto: The REDD+ programme, the Task Force, is basically a whole unit within UKP4. But to support that more effectively, there are ten working groups. These ten working groups have very specific issues to accomplish.

One is the national strategy, which is about to be finished. They are now in the process of disseminating the national strategy to the provinces and guiding the provinces to come up with their regional strategy. Group two is in relation to MRV, designing and developing an MRV system. Working group three is in relation to the funding mechanism. Number four is designing the REDD+ Agency, which takes over when this task force is finished. Working group five is about the pilot province. We already decided that Central Kalimantan is the pilot province. Working group six is on the legal review and enforcement working group. Seven is communications and stakeholder involvement. Eight is monitoring the moratorium, you know the President issued a moratorium policy last year, so we have a special working group to monitor that and to rectify if necessary. Working group nine is mainstreaming all these programmes that were set up by, or developed by, this REDD+ task force, so that they will be immediately incorporated into the national programme. Working group ten is support, that’s more on the knowledge management, because there’s so many new things happening.

REDD-Monitor: The task force finishes at the end of this year. What happens then? You mentioned the REDD Agency, which is an important part of the Letter of Intent between Indonesia and Norway. Will the REDD Agency come before the end of the year?

Kuntoro Mangkusobroto: Yes. I would hope by the end of the year, the task force can finish its job and then it immediately continues, seamlessly continued by the REDD agency. The agency design is now at the final stage, we’re going to report to the President hopefully end of the month or at least next month.

Heru Prasetyo: The report is in today [13 July 2012] to the President on that issue.

Kuntoro Mangkusobroto: It is for him to decide, because this is a political process. I hope that there’s a new law, new bill, or a new regulation to establish this agency.

REDD-Monitor: You’ve mentioned the moratorium. The moratorium is now one year old. What’s your view of the progress of the moratorium so far?

Kuntoro Mangkusubroto: Excellent. I think it’s excellent. It’s the first time, because of the moratorium, that we have one map. For Indonesia that is really important. Before, I don’t know how many maps we had. The National Agency for Land Administration had their own map. Agriculture had their own map. The Ministry of Forestry had maybe three, four versions of maps. If there’s a dispute, or you want to issue a licence, which map do you use?

Now we have one map. The map is far from perfect, but we are in the process of improving it. And the way we do that, is with people’s participation, in giving information for developing the map. If there’s no forest in an area where the map claims there is forest, then people can give us the information. So, the map is very important.

But the process of making this map perfect, is another important thing that is happening in this country. Because this is the first time that people are participating in a very significant reference about how this government makes policy. That is something that is really, really important. Something where I can say that things are progressing really very well.

I believe that the moratorium is also effective in terms of the fact that there are no new licences issued in this period. I heard rumours that say there’s a number of new licences also issued. But I asked about the source of them, I asked for proof, because once I get the proof then I will take action on that. And we haven’t got any.

Reviewing the legal procedure is not so easy. Because what we try to review is something that is very strong, legally. It’s not easy at all to review, to amend, to improve, what’s been already there, because they have a very strong basis, a strong legal foundation. In that area I can say that things are not easy. That’s why we have a working group on regulation and policy review and legal enforcement. In that particular area we have to wait until the REDD Agency is formed and then it will be based on a strong legal foundation. Then they can take real concrete action on these legal things.

Heru Prasetyo: It is true that the moratorium has given the momentum for us to do the one map. But the idea of the one map come up before the moratorium. A Presidential Instruction was already out. We did a presentation in the cabinet and we showed the President the map of Ministry of Environment and the map of the Ministry of Forestry. The basic assumption that they used to create the maps are different and because of that there is not a complete overlap of what is designated as forest by the two Ministries. At that moment the President instructed to create the one map. So the first impetus was because of the differences in the data in the map.

REDD-Monitor: When did that happen?

Heru Prasetyo: That was quite early because we were reporting perhaps our first report to the cabinet. It was 23 December 2010. The moratorium was actually May 2011, so the one map was announced five months before that.

Now, in reviewing the moratorium indicative map, we see that the moratorium is giving instructions. And we have started working on those issues, which is actually coming up with a more complete logic than just the moratorium map. The one map movement has these four elements that have to be, it has to have one standard. It has to have one reference. It has to have one database. And it has to have one geo-portal.

So we put our map in the geo-portal so that everybody can see, criticise, deduct, all those things. The one map movement has to have the integrity of the data, has to standardise in terms of understanding of terms between ministries and between agencies and between users. Then it has to have the map as a reference. That is the one map movement. It’s a big movement. Very difficult. That’s why when Pak Kuntoro explained about making it complete, making it perfect, it’s very difficult because that is the agenda.

The moratorium map is something that is smaller than this one map movement, but the activity that is done in the updating of the moratorium indicative map was actually very substantive by way of practices. You see, when we started the moratorium map we started from the best map available and that is what is available in the Ministry of Forestry. So from the Ministry of Forestry’s perspective, this is the best map that they have for this purpose. We accepted that. Then we say that it has to be made public, so it has to be on a website so that people can comment on it.

The first month after it was put on the website we had a lot of input. 46 letters came to the Ministry of Forestry mostly from companies who claimed that they already have a licence operating in an area and how come it is now part of the moratorium? What is the issue? Those kind of things.

But not only that, the map depicts the area and rules under the control of the Ministry of Forestry. We know that our land is not only owned and influenced by one ministry. Information also needs to come from the Land Authority, the Ministry of Agriculture (about oil palm and other concessions), the Ministry of Mining and Energy, and from the whole process of spatial planning, which is coordinated by the National Spatial Plan Coordination Board and operated by the Ministry of Public Works. There is a lot of other information that needs to come in. The fact that it is being made open, we also expect to get input from the NGOs and from the CSOs as well.

So the basic map that was the best at that moment was not the best for the purpose, long term. So how do we do the process of getting the correction, improvement happening? UKP4, under the instruction of the President, was given the role of monitoring the moratorium. So we took the initiative and invited the people from the different ministries who are in charge of the maps to sit down together and agree on how to improve the moratorium indicative map, with new information. That is the reason why the first review actually showed a reduction in the area of the moratorium, by about four million hectares. That is because of the process. It’s working.

The first review made use of the information from the Ministry of Agriculture. Then we are putting in the information from the Land Agency. The regulations said that land authority cannot provide Hak Guna Usaha [business license to cultivate] within the Kawasan Hutan, within the forest estate, as the Ministry of Forestry has control and management responsibility on that. The Land Agency cannot give rights or licences within the Kawasan Hutan. However, the data on the Kawasan Hutan itself may be outdated. For instance, the whole provincial capital of Central Kalimantan Palankaraya is still considered to be Kawasan Hutan, while it actually is very well built up. So we need to have that correction. The correction is still being done.

There are instances where the Hak Guna Usaha from the BPN, the Land Agency, is within the Kawasan Hutan. That becomes a dispute between two ministries to be resolved. And we are in the process of resolving that.

But the fact of the matter that the conflict is there, that the situation is there, is already open on the table. So it’s just waiting for a decision, in or out. We said, “We have this 379,000 hectares[*] to be added to the area under the moratorium.” The Ministry of Forestry said later that 93,000 is actually deducted from the area within the moratorium, because of their facts. For the public, that seems like a conflict, or differences of opinion between two established government agencies. The reality actually is that it is a process of adjustment. I think that that needs to be made clear.

REDD-Monitor: But there are some controversies relating to the moratorium. For example, there’s the MIFEE project in Papua. The moratorium maps that were issued in November 2011 excluded areas that had previously been included in the moratorium.

Kuntoro Mangkusubroto: Actually, in the first moratorium map we did not include data from the Ministry of Agriculture which owns data on peatland. It turns out that according to them, there is no peatland in that area, that’s why the MIFEE area was excluded from the second map. So it’s not covered in the moratorium.

For the first map we only used data from the Ministry of Forestry. We thought that the area had peat. Deep peat. But then we received data from Ministry of Agriculture that had not only desk studies but had also gone on the field. And they mentioned that there’s no peat in the area. The real issue is that there was more than one map, more than one authority. That is the real issue.

Heru Prasetyo: As you know, in the beginning the plan for MIFEE conceptually was to have it covering one million hectares. From the review on the ground and seeing what are the areas that need to be protected because of sacred lands, the indigenous peoples our Masyarakat Adat issues and all those things, it was reduced to be about 450,000 hectares. After that we looked into what is feasible and right now it comes out at about 220,000 hectares, which is supposed to be reasonable to operate on.

This is a location that is not too easy to access in terms of infrastructure, in terms of the facilities and all those things, so some of the investors are now having second thoughts because of the difficulties of operating there. Officially there is 220,000 hectares of land available. Practically, there is still a lot of work that needs to be done in terms of doing that.

Now that is not talking about peatland. The peatland issue is a bit different again. The peat conditions of the Merauke area was actually mapped by Wetlands International in the 1990s, from a desk analysis. Perhaps satellite images, you know that Indonesia has a lot of clouds, so maybe there was some lack of clarity because of that. The recent development was that the Ministry of Agriculture did a ground truthing survey and found that actually the claimed peatland was actually not exactly peatland.

As you know, peatland can be defined in different grades. You have peated land, you have peatland, you have deep peat. In the classification of the Ministry of Agriculture it was not considered to be as big an area of peatland as was initially understood using the Wetlands map. That is a fact that comes into the equation for the second review of the moratorium map.

REDD-Monitor: The second controversial area that I want to ask you about is the Tripa peat swamp in Aceh province. It seems to be a similar situation to MIFEE, except that the concession was actually awarded in August 2011, which appears to be completely in breach of the moratorium. And similar to MIFEE, an area that was red on the moratorium map was cut out.

Kuntoro Mangkusubroto: I know more about this case than what happened in MIFEE. They claim, the company claims, that they have a licence. But what kind of licence? They told us that the licence is not from the Ministry of Forestry but from the Land Administration. The licence is HGU [Hak Guna Usaha – business license to cultivate]. Finally we found out that it’s a fake licence. That’s why we sent a team after the second burning and killing of the orangutans. A set of people from the police and also Ministry of Environment were deployed to investigate.

The Minister of Forestry came himself to the site to check and he concluded that no licence came from the Ministry of Forestry. This is a criminal act. It’s nothing to do with the moratorium. This is a licence forgery.

REDD-Monitor: You issued a strong press release and sent a letter to the Ministry of Forestry in April 2012.

Kuntoro Mangkusubroto: To the Ministry of Forestry, Ministry of Environment, and the police chief. Because these are part of the working group on law enforcement.

REDD-Monitor: Unfortunately, a lot of the peat swamp has been cleared.

Kuntoro Mangkusubroto: Yes.

REDD-Monitor: You’ve said that it’s in breach of the law. So how is the law to be enforced?

Kuntoro Mangkusubroto: The criminal is the forgery of the licence. It’s not about the peat.

Currently, we are in the process of drafting a Presidential Decree to consolidate two drafts. One coming from the Agency of Public Works and one coming from the Ministry of Environment on Management of Wetlands. There are two Ministries that have their own interests. We have to step in to consolidate all that. It’s now done. But that’s a reflection on the situation that we are facing. Peatland is a no man’s area. Is it under Ministry of Forestry? Is it under Ministry of Agriculture? Is it under Environment? Now we have to define peatland as under the jurisdiction of a particular ministry, or maybe under the new REDD Agency that we are going to establish.

Heru Prasetyo: This is just a clarification. It’s actually not exactly a forgery. To get a licence to operate you have to go through a lot of layers, step by step and step by step. So what happened is that there was already a licence of third or fourth step but it’s not saying that you have the right to operate as yet. So when we asked BPN [the Land Agency], they said, “Oh yes, it is already given a licence on that.” But when we checked further it was not a licence to operate, it was just a licence to go to the next step. So it was not yet in the position that they are allowed to operate but they have operated already.

The Rawa Tripa case was controversial in the sense whether that area was under moratorium or not under moratorium. That depends on how early the licence was given on that area. Actually, the licence was given before the moratorium, but for another company. The area was not very much worked on. So if we are talking about the true moratorium map, my understanding is that it was not in the moratorium area.

Now the question is, “If it is not under the moratorium area, why the hassle?” The area is very close to the Leuser Ecosystem Conservation Area. So it is another kind of borderline situation. But it is peated. Then there was a claim that because there is already a Hak Guna Usaha, from before the moratorium, then it is acceptable to work on.

We sent our people there and we tried to find what is the real situation. The information from the ground was that it had never been given an HGU. If there is no HGU, it’s supposed to be inside the moratorium area. Earlier information was that it was given an HGU, so that becomes an issue that was reported in the media. UKP4 is very much into that issue, within our mandate. We don’t have the mandate to prosecute, we have the mandate to inform. So we informed the kapolda [Police Chief], we informed the kejaksaan [attorney], we informed the Governor. The new Governor is going to take action on that.

REDD-Monitor: You previously had a job of reconstructing Aceh after the tsunami. Was reconstructing Aceh easier or is the REDD+ Task Force job easier? Or can you not compare the two?

Kuntoro Mangkusubroto: Oh, the REDD+ is much easier. The reconstruction was a real fight! A physical fight, a mental fight. All the skills you have, you need to use all of them. The REDD+ Task Force is difficult on the legal issues and it’s long term. But as long as you have a strong nerve, it’s OK. In Aceh you had to have the strong nerve, you have to be strong physically, to keep fighting every day. Some physical fighting.

With the REDD+ Task Force, it’s more about strategy, you have to use your brain. You don’t just use your muscle to fight something.

Although saying that it is easier doesn’t mean that you have the probability of winning more than losing. That’s not what I’m saying. I might lose the game. Even though it’s easier. But I don’t want to lose the game.

REDD-Monitor: In October last year, CIFOR put out a report about the moratorium, which was actually quite critical. The “Stepping Stones” report. At the end of the report they included a series of recommendations. Are these recommendations being implemented?

Kuntoro Mangkusubroto: I did not read that report. My staff read that report.

REDD-Monitor: I’ll highlight some of the key recommendations. First, reviewing licences that are already approved in principle, because that’s one of the loopholes in the moratorium. Is there any process to review the “approved in principle” licences?

Kuntoro Mangkusubroto: That’s what I mentioned before to you, this licence is issued based on law and regulations. So, if everything’s according to the law and regulations, there is not much we can do. If there is something that is not according to the law and regulations then we’ll do something about it. For instance, at Tripa, we checked the licence if the businessmen have the licence from the Ministry of Forestry. If the HGU from the Land Administration is legitimate, I can’t do anything!

REDD-Monitor: But the question is, do you have a systematic approach to looking at all of the approved in principle licences?

Kuntoro Mangkusubroto: Oh yes, yes. That’s part of the legal review.

REDD-Monitor: The next recommendation in CIFOR’s report is about examining the performance of companies that have existing licences, because there’s another loophole about licence extensions. CIFOR is recommending that before extensions to existing licences are awarded that there should be some examination of the companies using criteria and indicators.

Kuntoro Mangkusubroto: No, that’s not part of our mandate, so that’s beyond our function.

REDD-Monitor: The next one’s out as well because it is about incorporating the results of this examination into the moratorium map.

Kuntoro Mangkusubroto: No.

REDD-Monitor: Another recommendation is about soliciting input from all stakeholders including the general public during the process of the moratorium map revisions.

Kuntoro Mangkusubroto: That is being done, yes. That is part of the map. Everyone can provide input. The whole process is like that.

REDD-Monitor: So some of CIFOR’s recommendations are being implemented, others not.

Kuntoro Mangkusubroto: Yes.

REDD-Monitor: You mentioned that the REDD pilot province is Central Kalimantan. What progress has been made so far on implementing REDD in Central Kalimantan?

Kuntoro Mangkusubroto: Well we already set up together with them a joint secretariat. It’s very important because we want the ownership to be with the people in Central Kalimantan, not with us. We guide them. But the ownership should be with them. That’s why this joint secretariat is very important. It’s bottom up, OK? But according to our guidance.

We are coming up with the projects to implement, especially in the ex-mega rice area. And that is something that we are working closely with the governor’s office on to ensure that the ownership is theirs.

We are also working on a map of Central Kalimantan. It is not yet finished, but we are in the process. We started a year ago. We are going to have a very complete and detailed map. That’s something that is really brilliant because that map would include all the licences. We should have a rough map, close to final, in August or September this year.

REDD-Monitor: Again, there are controversies in Central Kalimantan. There’s been a lot of criticism of the Australia project, the KFCP project, for example.

Kuntoro Mangkusubroto: When it comes to this sort of thing, I have heard many complaints, from Jambi and East Kalimantan, for example. Where the complaint is that basically these people, outsiders, sometimes from outside Indonesia but also coming from outside the province, they go inside the project area with a licence and pretend that the land is theirs. They don’t consult with the local people, they don’t do anything, they just pretend that they own the area and that’s it. If these complaints are true, then that kind of behaviour is a big mistake. And when I hear about that, then that’s their fault. That’s not the way we do this kind of project. This is not a construction project. We are dealing with people, we are dealing with local people, your word is “indigenous”, my word is Orang adat, it’s the local people. You have to respect all these people! They have their own culture, their own way of living in that area. And now they pretend that they have everything there because of that licence. Wrong step! Mistake. They’ll never succeed.

Heru Prasetyo: KFCP is a very interesting, controversial project. It’s large. It is supported by a very well intentioned force, in terms of having it done. When did KFCP start? That was before the LoI, definitely. I think it was 2010, or 2009. The project was almost dormant for about two years and then it got started again.

The basic project of KFCP, if I’m not mistaken, is ecosystem conservation and very much in terms of replanting and reforestation. Like many of the ODA [Official Development Assistance] support programmes the control of the home country is quite strong. The reporting is very much going to Canberra. The problems and the issues are very site based. So you have a site-based problem and you have a remote response. So there are a lot of misunderstandings, there are a lot of misconceptions, there are a lot of difficulties because of slow reactions to issues on the ground. I believe there are some changes in terms of their management as well as on the ground and in other parts of the operation.

From my perspective, from the REDD+ Task Force perspective, the issue of KFCP very much needs some resolution in terms of how this big project can be saved in terms of effectiveness. To show us how REDD+ can be done. Our attitude about that is not to say, “It’s a bad project, let’s abandon it.” We are also not saying, “This is a great project, let’s praise it.” It is a project that we need to look at very carefully and look in terms of awareness and put that into the perspective of what we believe to be REDD+.

When I say what I believe to be REDD+ I think that deserves some explanation. Because when people talk about REDD+, normally they talk about emissions reduction, payment for the reduction of emissions, which comes from avoiding deforestation and reduction of forest degradation. Basically the business is providing financial incentives for a reduction of emissions based on land use and land use change and forestry.

When we got into this job, in June 2010, we had a lot of discussions, with NGOs, with all the players, because we were starting from zero. We came to the conclusion that the reduction of emissions is not good enough as a momentum maker. We have a lot of momentum coming from the US$1 billion from Norway, that we need to define more aggressively. If we look into the pure calculation of what is the price that you can get from one hectare, the tonnage of the carbon, the price of the carbon and compare that with what is the potential revenue, economic value from cutting the trees, and planting palm oil, that’s nothing. We lost the argument on that. Our objective is actually conserving and protecting the forest, the ecosystem, the biodiversity as well as the social life within that. Which means that we need to look into this REDD+ programme beyond what is agreed in terms of the emissions in a carbon market and the pricing of that.

Definitely it has to be addressed, but we should not stop there. We looked into this and asked, “Is it going to give us better economic equity with the people? Is it going to give us the right of the rights of the people? Talking about indigenous people, or our Masyarakat Adat, is that giving us the momentum to really clearly deliniate the forest? How to protect the water system? How to do the ecosystem services properly? How do we preserve the biodiversity? How do we conserve that for future use?” Those kind of sustainable development questions.

We looked into this from that perspective and that is reflected very clearly in our National Strategy for REDD+. If you study our National Strategy for REDD+, the five pillars are not about selling carbon. They are about creating the foundations so that later on when we want to sell carbon we have the rules and the regulations. Because we could have fallen into the trap of making carbon the only thing and destroy the other things. We don’t want that.

We want to have the foundations right so that when we do the business of carbon trading it is going to be done on the right platform.

And so far our relationship with the Australians is very good in terms of their willingness to be open and see that from this different scalpel that we are using to cut and analyse the issues. We realise there are some issues with KFCP. We are not blind on that.

REDD-Monitor: A while ago there was an article by Reuters, the news agency, about the Rimba Raya project in Kalimantan. The project ended up with the Ministry of Forestry cutting the area in half, giving half of it to an oil palm company. Reuters described the project as a “casualty of labyrinthine Indonesian bureaucracy”. Do you think that this is a one-off in this particular case or do you think that this illustrates a typical problem with this kind of REDD project in Indonesia?

Kuntoro Mangkusubroto: It will be a typical problem. Let’s not have head on collisions between the business and the conservationists. It’s typical. It’s a head on collision. Now, it depends on the integrity of the bureaucracy. That’s a problem, OK? Because that kind of friction will be everywhere. You can find it in Papua, Maluku, anywhere. Because there is always competition between those who want to establish a palm oil estate and those who want to preserve that area. And usually the capitalists win. Because they have the money to bribe the bureaucrats. So if you have a very strong bureaucracy with high integrity, then although the capitalists have money to bribe they don’t take that bribe and that’s it.

That’s typical.

REDD-Monitor: What do you see as the solution to that problem?

Kuntoro Mangkusubroto: Review the legislation. Review the procedure. Review the bureaucracy. Review the mechanism.

REDD-Monitor: And is that included in the REDD+ working group on legal issues?

Kuntoro Mankusubroto: No. Systemic things are outside the mandate. Individual cases are inside. If we found a case, like Tripa, I’m going to send people immediately to study the case, but when it comes to systemic things, the law, for the time-being it’s not part of our work. But we do identify those things that will be very important once the REDD Agency is established. So our homework for the new agency is to highlight these things that should be reviewed once the REDD Agency is set up. But for us, as the REDD+ Task Force, it’s beyond our scope for the time-being.

REDD-Monitor: There’s been a lot of discussion and a lot of things happening on REDD in Indonesia. There are about 40 projects, a pilot province and so on. At the same time oil palm concessions continue, mining continues. Are you optimistic about REDD or pessimistic?

Kuntoro Mangkusubroto: In order not to get frustrated, you have to realise that you’re not in a vacuum. We are starting a new programme, a new paradigm, a new concept, a new way of seeing things. But you have to understand that you are working on something that’s been running for the past 40 years. You cannot stop everything at once. Now new paradigm comes, OK, the old paradigm stops. You cannot do that. There’s always a transition period. And this transition can be managed very well if you do it properly. It’s not a zero, one programme. It’s always a half, half. But at a certain point it becomes a zero, one. And we hope that the zero is theirs and the one is ours.

REDD-Monitor: What is your position on carbon trading?

Kuntoro Mangkusubroto: I don’t know anything about that, because it’s too far away. I still don’t understand, because where’s the mechanism? How do you set the price? I don’t see the aim.

I know there are bi-lateral carbon trading projects, but is that a pricing mechanism? Is that a market? When it comes to bi-lateral projects, OK, I have some understanding, The capitalists don’t want to spend money just for conservation. They are not romantic people, who just want to see the trees standing and are willing to spend money for that. No. They want to get some return, for sure! And where are they going to get the return from? From Australia, from Germany, from the market? And how much? I don’t know. How do you regulate the carbon market? I don’t know! How do I tax them? I don’t know. Where will the money go? To local communities? I don’t know.

So there are many “I don’t knows”. I have to understand, yes, but not now. I have to regulate them, yes, but not at this stage.

For me, carbon trading is something that’s really important, because that is what makes people move in this direction, because that is the incentive. But at this stage, well, I’m still busy with the moratorium map. I’m still busy with Tripa, that sort of thing. Well, let’s wait for another couple of months then after that maybe I’ll be more knowledgeable than now.

REDD-Monitor: One of my concerns with carbon trading is that if the Indonesian government decides that it’s going to trade the carbon that is stored in the country’s peatswamps and forests, the reductions in emissions are not going to be counted as Indonesia’s reductions, they will be counted by the country that buys the carbon credits (which it then uses to continue to pollute). President Susilo Bambang Yudhoyono has said that he is aiming for 26% or 41% emissions reductions. That target will have to be on top of what Indonesia has traded to other countries. Otherwise it will double counting.

Kuntoro Mangkusubroto: No! The most important thing is we have a baseline, there’s the baseline. Whatever we reduce is Indonesia’s!

REDD-Monitor: Not if you sell the carbon credits. This is a problem that China has raised with the CDM.

Kuntoro Mangkusubroto: OK, I’d better stop here. But for me, whatever reduction we achieve that is ours. The actor can be you, British, it can be me, Javanese. But if it happened here in Indonesia, it’s part of Indonesia. It doesn’t make sense to me that because a power plant company in Germany sends money here to preserve forest then the carbon is theirs. No! The carbon is ours, but we sell it to you.

Heru Prasetyo: Carbon trading is something that we are still analysing. I am sharing with you some understanding that we have on that issue, but not necessarily the position of the REDD+ Task Force.

You’re talking about the carbon is not yours when you do the offset, then the carbon benefit is already in the German companies or the Australian companies. We are aware of that, definitely.

Let’s talk about the US$1 billion public funds. I always tried to analyse that based on these three layers of funds. First is the public funds. The second is the private investment. And the third is the carbon market. Private investment is using IRR [Internal Rate of Return] or ERR [External Rate of Return] when you’re talking about doing ecosystem restoration investment.

Let’s address the public fund first. It was actually jointly and commonly understood between the people of Indonesia and the people of Norway, that this is definitely not about carbon credits. The effort that we are doing on that in three stages (the first preparation, the second transition, the payment for performance later on) was underlined by an understanding that this is not generating carbon credits.

I went to Oslo, because of exactly that question, raised by NGOs in Norway: Will this generate carbon credits? They don’t want their government to squander their potential of reducing their own carbon by buying it from here. So I went there and I explained to the Parliament, I explained to the NGOs there, this is not about carbon credits.

So what is Norway going to pay for our performance later on? We reflect what happened in Brazil. The case of Brazil was based not on carbon but on deforestation in the beginning. The Amazon Fund was based on deforestation. When they can prove that deforestation goes down, then there is some compensation. And what is that money for? It’s up to the Government of Brazil to use. It is basically to propel their effort to reduce deforestation further. So we are thinking in that way as well.

From that perspective, Pak Kuntoro’s answer, “The carbon is mine! My reduction,” is proper. We will continue doing that in all our agreements and all our arguments in what I call “multi-bilateral relationships”. I was quoted by CIFOR in their blog for this multi-bilateralism. I’m saying that instead of relying and waiting for UNFCCC, the multilateral forum, to define what needs to be done, we can rescue this and define REDD+ the way that we think we need to define it and agree with a bilateral partner. Norway agreed with our approach on this. That kind of agreement is not based on carbon credits, but on what needs to be done in terms of improvement of the way that we govern our land, we govern our forests, we govern our processes for providing licences, and so on. That is something that the money is going to be used for. These are the bilateral things.

How about private investment? When private investment comes, money is going to be used to really develop ecosystem restoration programmes. We need to put safeguards on that. Investment needs to be attracted in a way that is addressing the need of the people as well, do it in a partnering way, so that they are part of the solution. By doing that, you are addressing the issue of social equity already.

Later on, when you claim the carbon, two things may happen. Indonesia cannot claim this carbon anymore because it’s already been sold. This is where the interaction of public funds and private investment comes into play. Because when I do my carbon calculations for the whole of Indonesia, and I get my claim of my carbon, I may say that if one hectare is on a tier three calculation, and reduces 1,000 tonnes, just to give a number, or a range between 500 and 1,500, I may agree with Norway to consider that as 500. If the price is between US$5 and US$20 I may agree to have it US$8 or US$7 with Norway and get paid for that. So that’s 500 by US$8 or US$7. That is my money for my carbon. It is not a trade. Because it’s not a carbon credit.

But if a company like Gazprom or Statoil agrees with an Indonesia company to invest in a REDD project to generate carbon credits, I will want to have the right to tax it. It is a business to business transaction and the taxation is like claiming the value of the natural asset, to invest back into the country.

It’s a bit complex, who exactly owns the carbon. We can still own the carbon and let business do their business here. Meanwhile I still get the benefit of that for my people. How it is going to happen and what law and regulations need to be put in place, needs to be changed, is something that is down the road. We have to face it. But that is the concept that we have in our minds.

The third layer, the carbon market facilitation, who will get the benefit of that facilitation? If my funding instrument is very much an international thing, the non-interest bearing income may go to somebody else. So I need to set up my funding instrument having a balance of the capacity of the capability and the reputation that is internationally acceptable, but ownership and ability to share the benefits, needs to be local. That is where another issue will need to be put in the way of doing business, and actually the carbon is something that we share.

A country or company can make use of that carbon to do claim emissions reductions, and the local people are going to give them pressure if they are not reducing their emissions at home. We are doing this, because this issue of emissions reduction is still very widely contested. If the US is not willing to sign anything on this issue, it’s just like saying the American way of life is not to be negotiated, like the old George Bush mentioned in 1992. But this is moving into something. We see that movement into a more balanced, more sustainable work, we need to play in that game, in that transformation.

It is actually economic growth capitalising on this new commodity so to speak, but giving more equity, social equity to the people. There is a lot that needs to be done for that. Our land tenure needs to be clear.

REDD-Monitor: How do you think that REDD should be financed?

Kuntoro Mangkusubroto: By the government and by the international community. What do you mean by finance?

REDD-Monitor: Should it be, for example, like the Norway-Indonesia REDD LoI?

Kuntoro Mangkusubroto: Yes, yes, yes.

REDD-Monitor: Or another option is that the UNFCCC comes up with a carbon trading mechanism similar to the CDM.

Kuntoro Mangkusubroto: Oh. If you go in that direction again, I’ll stop there, because my understanding of UNFCCC is that there’s too much politics involved. I’m dealing with something that’s more concrete here. But one day I’m going to reach that stage in which I can answer your question.

But when it comes to financing, yes, both, international, meaning Norway, British and so on, as well as from the Indonesian budget.

REDD-Monitor: I gather from that that you don’t want to comment on the outcome of the UNFCCC negotiations in Cancún and Durban.

Kuntoro Mangkusubroto: No, no. I don’t care about that. For me, this is Indonesia’s forest, and I believe that this forest should be kept as a forest. That’s what I believe. I don’t care what UNFCCC produces, I don’t care about that. That’s my belief, that’s my value.

REDD-Monitor: You gave a speech at a conference in Lombok last year in which you said that there are 33,000 villages within or around the forest estate. What was your source for that number?

Kuntoro Mangkusubroto: I quoted that one hour after the Minister of Forestry mentioned that in Lombok. So you need to ask him. I quoted his speech, which is an official speech, right? I was surprised as well because that’s the first time I heard that figure.

REDD-Monitor: You mentioned indigenous peoples in passing, earlier on. Indonesia has signed the UN Declaration on the Rights of Indigenous Peoples. At the same time, the Forest Law states that customary forest is state forest. You personally have called attention to the importance of indigenous peoples rights in forests. How do you see this apparent conflict between …

Kuntoro Mangkusubroto: Well basically it’s not a conflict. We don’t accept the word indigenous. Indigenous applies in Brazil, where Indians are the indigenous people. Here, everybody is indigenous – pribumi.

We use different terms for those people who live in a forest. In Jambi we call it suku dalam, in Kalimantan we call it dayak. All of them are pribumis. All of them are indigenous.

So, if I move from Jakarta to somewhere in the middle of Central Kalimantan, I am becoming a local person as well. I am pribumi. It is difficult to determine that under the law. So that’s why it is the state that manages that land. We cannot define the Dayak people as owning that area. Basically that is the difference and the difficulties in trying to make a comparison between the definition and the implication of the law here in Indonesia and somewhere else. Maybe it can happen also in Africa. But in South America or United States you can see very clearly who are the indigenous and who are not indigenous. That is the problem here.

And that’s why we don’t have indigenous. Masyarakat Adat translates as customary. So we cannot give the customary because we don’t define the Dayak as the owner of that area. When I go to a Dayak area then I’m part of the group that has the right also to have a piece of that forest. That’s the problem.

I’m for them. I’m going to support their rights, but it’s still a big question what is the best entry point to do that? Once you say that the Dayak people have the right, then we have a problem. Because basically our law does not permit them to. I am for the Dayaks. I am for the Papuans who live on the trees. I am for the suku dalam. But I have to be very careful because the whole thing will be very difficult.

Indonesia does not accept the definition of Indigenous People, defined the same as in Latin America. If you use that in Japan then you’ll get difficulties as well, because the ainus are the indigenous people, right? They are the owners of Japan. The Japanese people are mongoloids coming from outside. The same thing applies, that happened like this in Indonesia.

So that is the problem, it’s a delicate problem but we have to find out the way and how to support the rights of the people who live in the forest. Because I believe it is them who can really protect the forest. It’s not the outsider. But how do you put that correctly in our legal system, that’s the problem.

REDD-Monitor: That’s quite a controversial view of indigenous peoples.

Kuntoro Mangkusubroto: Controversial?

REDD-Monitor: One of the principles about defining indigenous peoples is that the indigenous peoples themselves define whether or not they are indigenous. The state cannot decide for them. That’s enshrined in international law, ILO 169 makes that very clear.

Kuntoro Mangkusubroto: That’s why you cannot take it away from the history of the nation. You know that we actually have hukum adat, customary law. But when it comes to implementing it, then usually the hukum adat cannot stand against the state law. In West Sumatra you have the hukum adat, it’s very strong, but when it goes head to head with the state law, it loses, basically. And why is it like that? Because the forming of this nation is based on the unitary state of the whole nation.

Once you change that, then for sure the people in Papua will say that we are not part of Indonesia. And that’s the problem. Because the Papuans are totally different than the others. From the physical side they are different. But they are not Melanesians. But we have problems. The Dayaks are different. Once you do that, Bali for sure will go out of Indonesia because they are the indigenous people. It’s not Indonesia. Indonesia, the invader? Agh! Now we’ve got a headache. Why are you so different, you look the same. No we are Hindu. Ah. That is the problem.

So although I am for them, the entry point should be precise. Otherwise, you cannot win. Because the state law is very strong. The people who established the state law, in the 1950s and 1960s, really understood this. But a unitary state of the country is the number one. The Sasak people, the Balinese, the Baduys, we are so heterogenous. That’s the problem here.

So that’s why we support, I support AMAN [Aliansi Masyarakat Adat Nusantara]. I support them. But also I have to be with them in trying to define the right entry point to win the case, otherwise it will be very difficult. For me, my interest is, I believe it is them, actually, who can protect the forest. But be careful, I told them, it is your generation now, OK, the next generation might have different ideas. And the difficulty will be they have a feeling that this forest is mine, and I can do anything I want to do. And they cut the tree, that’s finished. So it is not the invader that is going to cut the tree, it is themselves who is going to cut the tree. And then I will lose the game.

CORRECTION – 24 September 2012: Heru Prasetyo is Deputy I at UKP4 and a member of the REDD+ Task Force. He is not the REDD+ Task Force Secretary as previously stated.
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CORRECTION – 25 September 2012: The area concerned is 379,000 hectares (not 79,000 hectares).
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