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Indonesia’s Forest Investment Plan endorsed despite criticisms from civil society

Indonesia's Forest Investment Plan endorsed despite criticisms from civil society

In March 2012, Indonesian NGOs wrote to the Joint Forest Investment Program Team to protest at the poor consultation process and demanded that the process of preparing the Forest Investment Plan is postponed until their were met.

The Investment Plan was delayed, partly as a result of the NGO reaction. A new draft of the Investment Plan was presented this week for endorsement at the FIP sub-committee meeting in Istanbul, Turkey.

In an update presented at the FIP Pilot Country Meeting on 31 October 2012, Indonesia acknowledged that,

“The investment plan consultation process can be logistically difficult, expensive and long, especially in large countries with geographically dispersed and culturally diverse stakeholders, like Indonesia.”

On 5 November 2012, NGOs wrote to the FIP sub-committee pointing out that the “participation process” is still not acceptable. The letter explains that legal reforms are urgently needed in Indonesia (in particular to the Forestry Law) before the Investment Plan can be endorsed if business as usual is to be avoided:

[T]he FIP must support the legal reform efforts prior to program implementation. Without a complete commitment to resolve these basic forestry problems, any new program or project will only continue perpetuating existing problems, or business as usual.

Nevertheless, the Investment Plan for Indonesia was endorsed this week by the sub-committee.

The NGO letter is posted below. The NGOs’ analysis of the FIP, titled “Comments and Recommendations on the Forestry Investment Program/Plan Document”, is available here (in English and Bahasa Indonesia).

Jakarta, 5 November 2012

To: Members of the Sub-Committee Forest Investment Plan

We are a network of civil society organizations with concerns over natural resources justice issues in Indonesia and environmental conservations. The Forest Investment Program / Plan (FIP) is one of the plans which we consider to have great potential to have serious influence for communities at the site and to support the management of forest resources by the government in the present and future.

Throughout the process of developing the FIP document we have submitted comments, criticism and inputs to the Indonesia FIP team, through letters dated 16 March 2012, 6 April 2012, and a submission of Comments and Recommendations dated 21 September 2012, as well as direct comments.

The reference document we analyzed and later used to provide several recommendations is the document in Bahasa Indonesian entitled FOREST INVESTMENT PROGRAM – INDONESIA FOREST INVESTMENT PLAN 2012. The document was downloaded from the website the Ministry of Forestry of Republic of Indonesia as follows: (

This submission was also presented at the National Forestry Council’s (DKN) forum on 14 September 2012, attended by the Government of Indonesia and the MDBs Joint Team for FIP. On 8 October 2012, the DKN formally announced the web link to download the revised document (document dated 26 September 2012). The link was accessible at that time. However, when we tried to open the link on 30 October 2012 until the time this letter was sent, the link is no longer valid.

This is a reflection of a classic problem which re-appears when public consultation only relies solely on internet access. Not only the problem of accessibility where not all people in Indonesia have internet access, but even the one that was officially disseminate by DKN was no longer accessible.

In the national context, there is no adequate legal instrument to ensure that this program can be well implemented. Based on the facts mentioned, the whole process must wait for the enabling conditions which are the responsibility of the Republic of Indonesia to fulfill.

We have stressed the enabling conditions in our submission dated 21 September 2012, attached. Through this letter we would like to emphasize the following concerns:

First, about the participation process:

a. Public comments should be taken into account seriously, being integrated in the document body, instead of just put into the appendix. The result of the integrated document should have been open for public before being submitted to the FIP sub-committee.

b. FIP should not merely use DKN to conduct socialization and consultation process, because FIP has the obligation to have a consultation process right down to the grassroot level, particularly in the areas where FIP potentially will be implemented. This should be made accessible and in the simplest form that can be understood by the people affected without diluting the meaning.

c. FIP has the obligation to conduct a consultation process that substantively should refer to the REDD+ National Strategy. However, the process should comply with the policies of the MDBs themselves. Yet, this process should not substitute the obligation to undertake a genuine and inclusive participation process (including consultation) as defined by the FIP Guidelines for Consultations according to subparagraph 16(d) of the FIP Design Document.

Second, about legal foundation:

Most of the legal references in the FIP document are to The Forestry Law. The characteristic of this law has made it one of the most problematic policies in Indonesia, especially for communities living in and around the forest areas. One of the most serious problems is that there is no recognition of the rights of indigenous people over the forests as a part of forest under rights; as their communal rights to the land are not fully acknowledged (Article 1 point 4). This article is further supported by the language criminalizing people who live in the forest areas. Therefore FIP will have to support forestry policy changes, including by openly urging for changes in The Forestry Law that fully acknowledge the rights of indigenous people and local communities and to revise elements of the law that criminalize forest-dependent communities . This document should refer substantially to TAP IX/MPR/2001, as a basis for encouraging the review of all natural resources policies, including The Forestry Law.

Third, FIP should use a set of standards and definitions to avoid misinterpretation, among others:

a. The terms and criteria for “forestry enterprises” or forestry businesses, as mentioned in paragraph 146 and chapter 6.2.3, which aims to strengthen particular forestry businesses. Here it is not clear the criteria for or scale of the “forest enterprises” that are being discussed. Although this part of the program falls under the IFC intervention activities, the “enterprise” criteria used must not be the IFC criteria for “micro enterprises, small enterprises, and medium enterprises,” as the IFC criteria are not appropriate considering the business conditions and culture of farmers in the village context. The criteria regarding the number of people, turnover, and asset criteria are not appropriate for small societies.

b. The term KPH, which in English terminology is written as “Forest Management Unit.” This has caused confusion, because in Bahasa Indonesia the term “Unit Manajemen Hutan” is an entity which is conceptually is not similar to KPH.

Fourth, Besides the things that we have mentioned above, there is also the question of legal certainty of investment, where the inauguration of the new forest, as noted in the Bahasa Indonesia version of FIP document paragraph 58 page 17-18 that only 14.24 million hectares gazettement from overall 140 million hectares. That version of the FIP document itself says in page 7 there are uncertainty regarding the legal framework and the conflicting implications of sectoral and spatial regulation. In these circumstances how could FIP investment guarantee legal certainty? (General Comment No. 1, on point 2 and 3 Indonesian Civil Society submission to Indonesian FIP team dated 21 September 2012-attached).

Looking at the abundance of basic forestry problems that must still be resolved such as forest tenure, the community’s rights and others as stated in our points of above, we consider that steps to resolve Indonesia’s basic forestry problems must first be implemented before running a new program or project.

Thus, the FIP must support the legal reform efforts prior to program implementation. Without a complete commitment to resolve these basic forestry problems, any new program or project will only continue perpetuating existing problems, or business as usual.

Based on the arguments above, we strongly urged for these problems to be addressed before the Indonesia FIP is approved.

Thank you for your kind attention.


debtWATCH Indonesia
Jl. Raya Bogor KM 19
Gg. Musholla Ar-Rohman No. 198E
Kelurahan Tengah, Kecamatan Kramat Jati
Jakarta Timur 13540
Indonesia Telp./Fax.: (62-21) 80884655

on behalf of the signatories:
debtWATCH Indonesia
Bank Information Center (BIC)
Forest Watch Indonesia (FWI)
ELAW Indonesia
Aliansi Masyarakat Adat Nusantara (AMAN)
Koalisi Rakyat untuk Hak Atas Air (KRuHA)
Institute for Essential Services Reform (IESR)

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