STATEMENT BY UK NGOs ON THE FORESTRY MoU BETWEEN THE INDONESIAN AND UK GOVERNMENTS

We, as UK NGOs working on forest issues, share the concerns of Indonesian civil society organisations about the rapid rates of deforestation in Indonesia and the consequent loss of sustainable livelihoods. The UK has a special responsibility as a major importer and consumer of illegal timber and wood products. So we value the efforts of the Indonesian and United Kingdom governments to take action on forest law enforcement, illegal logging and the international trade in illegally-sourced timber and wood products and welcome the Memorandum of Understanding. We recognise that both governments have already gone a long way towards committing themselves to such measures through the Forest Law Enforcement and Governance Ministerial Declaration (FLEG) signed in September 2001. Other positive steps include the Indonesian government's plan to improve forest management agreed with the CGI and the UK government's commitments to procure timber from legal and sustainable sources.

The good intentions of the MoU will depend on follow-up actions. We note that this agreement is based on the principles of participation and transparency endorsed through FLEG. We therefore urge both governments to consult widely and openly with stakeholders in both Indonesia and the United Kingdom, including civil society organisations, in drawing up and implementing an effective Action Plan.

We support the views of our Indonesian colleagues and counterparts that action on forest governance and illegal logging must take place within the context of the broader reforms in Indonesian forestry policy and practice in order to address the underlying causes of deforestation. Over-capacity in the timber industry, security of tenurial rights for indigenous peoples and local communities to their forest areas, and the eradication of corrupt practices are included in the list of actions attached to the FLEG declaration and in the recommendations of the 3rd Indonesian Forestry Congress. We therefore urge both governments to give priority to these issues in the Action Plan for this bilateral agreement and in subsequent initiatives to tackle forest destruction and degradation in Indonesia.

In particular, we would draw the attention of both governments to the following points:

1. Eradicate corruption: The approach to controlling deforestation in the MoU relies on an administration, police service and judiciary which deal with rich and poor equally. Law enforcement must therefore depend on the swift eradication of corruption. Otherwise, poor people holding the chainsaws will be punished while large companies, their directors and investors (including those in the UK) profit from illegal logging and trading with impunity. A start might be to enact legislation requiring all public employees, including members of MPR, DPR, DPRD, Pemda, the military and police to make public details of their ownership of or involvement in any forestry operations, including wood processing and plantation companies.
2. Recognising tenurial rights of forest-dependent communities: Under current state law, indigenous people felling trees in their customary (adat) forest is an 'illegal activity', especially if their domain has been declared protection forest or a conservation area. Under these circumstances, law enforcement will increase conflict with local communities and potential human rights violations. The Action Plan should include a review of conflicting formal and customary norms and laws and develop mechanisms for resolving conflict and overlapping property rights – as proposed in the FLEG agreement. The tenurial working group within the Department of Forestry, supported by DFID-MFP, NRM/EPIQ and ICRAF, should be revitalised to carry out this review and provide the basis for legal reform.
3. Credible Chain of Custody: While systems for tracking timber from legal sources are well advanced and relatively straightforward, this MoU covers wood products in general Over-capacity in Indonesia's pulp and paper industry has been identified as an important factor driving illegal logging by a UK government-funded study. The governments must devise credible, independently verified systems to prove the raw materials for Indonesian plywood, fibre board and pulp and paper come from legal sources.
4. Aid, export credits and corporate accountability: The co-ordination of donor-funded programmes and projects on illegal logging, forest-related governance, international timber trafficking and forest management in general in Indonesia must be improved. The UK government – via DFID – should also take a leading role in encouraging other donors to adopt a more participatory approach to identifying, monitoring and evaluating forest-related projects. In addition, donor countries including the UK should ensure that all government-supported investment agencies and export credit and guarantee facilities adopt social and environmental criteria for investment, requiring the highest environmental and social practices from the private and public sectors.

Finally, we would remind both parties to this pioneering agreement that legality and sustainability are not the same. For example, the conversion of natural forest to large-scale plantations may be legal, but it is not ecologically, socially or culturally sustainable. Moreover, in the long-term, such developments may not be economically sustainable. This bilateral agreement is an important step towards controlling illegal logging and the illegal timber trade. Nevertheless, we join our Indonesian colleagues in urging the Indonesian and the UK governments to take further action to promote the broader goal of sustainable, equitable management of Indonesia's forests.

London, 17th April 2002

Signed

Liz Chidley and Carolyn Marr, Down to Earth
Kim Terje Loraas, Rainforest Foundation
Matt Phillips, Friends of the Earth England, Wales & Northern Ireland
Jon Buckrell, Global Witness
Dave Currey, EIA
Paul Toyne, WWF United Kingdom
Sonja Vermeulen, International Institute for Environment and Development
Saskia Osinga, FERN

See also DTE press release