Reviewing World Bank’s Forests and Natural Habitats Safeguard in the context of Indonesia

1. Reviewing World Bank’s Forests and Natural Habitats Safeguard in the context of Indonesia Orchida Ramadhania

2. Overview The World Bank safeguard review and update is a welcome opportunity to strengthen the Bank’s current forest and natural habitat policies to reflect international best standards and lessons learned from the Bank’s own projects, through Inspection Panel cases and the 2013 IEG evaluation of the World Bank Forest Strategy implementation

3. Independent Evaluation Group (IEG) Report 2012 • Between July 2002 and June 2011, the World Bank invested US$4.1 billion into 345 forestry related projects. • 2013 review of Bank forest portfolio by the Independent Evaluation Group (IEG) found that overall these projects have failed to address poverty or to benefit local communities.

4. Forest Alivelihood source for an estimated 1.6 billion forest dependent peoples, many of whom are indigenous. Forest dependent peoples comprise 90% of the world’s people living in extreme poverty. In Indonesia, the number of this directly dependent people to forest is 60million or a quarter of our total population.

5. Indonesian Context Indonesia has the 3rd largest tropical forest area on earth.  Forest covers 99,6 million hectares of land or almost 52.3% of Indonesia (data: Book of Statistic on Indonesian Forest, Ministry of Forestry 2011, published on July 2012) Also one of the fastest country in its deforestation pace. Reaching a 610.375,9 hectares a year (data 2011) and back in 2007, Indonesia set a record as the world’s fastest on deforestation pace. In total, for the last decade we have destroyed 10 million hectares. It is equal to destroying forest areas as large as 300 football fields every hour. It is now predicted that we only have 28% of our natural forest

6. Forest governance issues in Indonesia • Lack of land tenure rights • Lack of consultation, consent – including recent examples with Indonesia’s Forest Investment Plan, supported by the World Bank and IFC • Role of military • Lack of judicial due process • Corruption • Bad governance and overlapping policies The World Bank’s Justice for Forests study report risks of weak forest governance, which the Bank must proactively address through safeguard policy, cites a four year study in Brazil, Mexico, Indonesia, Philippines which found that the probability of illegal logging crime being penalized was less than 0.082% (in West Papua, Indonesia, it was 0.006%)

7. Tata Cara Permohonan IUPHHK HA/HTI/RE PEMOHON GUBERNUR BUPATI DISHUT KAB BPKH MENHUT SEKJEN B U K TIM PENILAI DIRPLAN Surat Permohonan • Akta pendirian • Surat Izin Usaha • NPWP • Pernyataan mendirikan cabang di daerah • Peta min skala 1:100.000 Pertimbangan Bupati Pertimbangan Ka-Dishut Analisis Kaw Hutan Surat Permohonan TEMBUSAN Surat Permohonan penilaian TEMBUSAN Surat Permohonan Rekom Gubernur + Peta min 1:100.000 TEMBUSAN Surat Permohonan Rekom Gubernur + Peta min 1:100.000 Terima/ tolak Permen No 50/2011 IUPHHK-HA, HT, RE TEMBUSAN Surat Permohonan Proposal Teknis Terima/ tolak Terima/ tolak Terima/ tolak Menyusun amdal Terima Sp-1 amdal amdal amdal Working area & bptt Sk iuphhk Terima Sp-2 Bayar iiuphhk Sk iuphhk Konsep Sk iuphhk Konsep Sk iuphhk

8. Concerns about Offsets • Indonesia: governance concerns, lack of land rights, participation, consultation, consent, military involvement, corruption; • Concerns about suggestions for that offsets be used if “unable to avoid” damage to environment; legitimization of otherwise banned forest destruction; • Concerns about suggestions of developing national aggregate offset plan in context of poor governance, lack of land rights. • Biodiversity offsets should not be used to compensate for adverse impacts on critical natural habitats, including those utilized by resource-dependent communities.

9. Important definitions: ‘CriticalHabitat,’ ‘Forest,’ and ‘Degradation.’ Critical habitat must include all intact forests, other high conservation value areas and areas of socioeconomic and cultural value to local communities and indigenous peoples. Forest Is NOT monoculture plantations “Degraded” forests Any definition of “degradation” must ensure that plans for the use of “degraded forest” do not involve the eviction or resettlement of forest-dependent peoples nor the curtailment of their ownership, access or use rights.

10. Revised Safeguards Must: 1. Prohibit Bank support for industrial logging; prohibit the conversion, degradation or destruction of critical natural habitats, including through the use of offsets 2. Fullyrespect the rights and livelihoods of forest-dependent peoples and Indigenous Peoples and ensure their full participation and free, prior informed consent throughout all aspects of forest policy development 3. Mustbe mandatory – contractually and legally binding. 4. Must include strengthened impact assessment, including risk and gender assessment, and safeguard implementation, and 5. Must apply in a uniform manner to all of the Bank’s activities and instruments in a manner which strengthens safeguard implementation. 6. Strong Bank safeguards must apply to all forms of climate finance.

11. Thank You When all the trees have been cut down, When all the animals have been hunted, When all the waters are polluted, When all the air is unsafe to breathe, Only then will you discover you cannot eat money. -Native American Proverb-