Indonesian logging ban breached on day one

Norway stands to profit from investments in moratorium-breakers

June 2011: On the day Indonesia's landmark ban on forest conversion was signed and celebrated in Jakarta, it was being actively broken in a crime-riddled Pilot Province, a new report reveals.

LOGGING: But Indonesia's ban on forest  conversion is already being flouted

The London-based Environmental Investigation Agency (EIA) and its Indonesian partner Telapak documented peat forest in Central Kalimantan's moratorium zone being illegally razed by palm oil firm PT Menteng Jaya Sawit Perdana (PT Menteng.

The moratorium and Pilot Province are both cornerstones of Indonesia's US$1bn agreement with Norway on Reducing Emissions from Deforestation and Forest Degradation (REDD+).

Yet perversely, Norway stands to profit from the breach of the ban courtesy of its $41.5million shareholding in PT Menteng's parent company, Kuala Lumpur Kepong Berhad (KLK).

Regulatory chaos is a serious threat
In the new briefing, Caught REDD Handed, EIA and Telapak warn that regulatory chaos and a culture of impunity in Indonesia's plantation sector pose a serious threat to the moratorium and any meaningful attempt to protect the nation's forests and reduce carbon emissions.

While PT Menteng is already violating the moratorium, information from the Indonesian authorities shows hundreds of plantations are operating beyond the law in Central Kalimantan alone, where illegal plantations substantially outnumber legal ventures.

‘Crime and corruption in Indonesia's forestry sector has resulted in President Yudhoyono's moratorium being undermined the very day it was signed,' said EIA forest campaigner Tomasz Johnson. ‘Without significant law enforcement improvements, REDD+ looks set to fail in Indonesia.'

Norway has investments with scores of logging companies
EIA research shows that Norway's Government Pension Fund Global (GPFG) has investments in scores of plantation and logging companies in Indonesia, including four major groups operating 24 plantation subsidiaries without relevant permits in the Central Kalimantan Pilot Province.

EIA estimates Norway has made roughly five times more money from plantations and logging in Indonesia and neighbouring countries during the past year - including illegal operations - than it has granted to Indonesia thus far under the $1 billion REDD+ Letter of Intent.

‘Relying only on the moratorium and REDD money will not solve the problem of deforestation in Indonesia, and with such poor forest governance in this country we should all be aware of countries such as Norway which are able to take a profit from deforestation,' said Telapak Campaigns Director Hapsoro.