Show Me the Green

With its rampant forest fires to clear land for plantation agriculture, Indonesia, has become one of the world's top carbon dioxide emitters, according to a World Bank study. Now it is asking rich countries to stump up compensation to developing nations to not cut down any more of their forests, along with supplying the resources, technology and financial support to overcome the negative impact of climate change.

In the developing world, greenhouse gas emissions mainly originate from agriculture and land use changes such as deforestation. The recent report “Indonesia and Climate Change” published by the World Bank and the British government in March 2007 argued that Indonesia, despite its relatively small economy, is the world’s third largest CO2 emitter after the United States and China because of deforestation.

Whether Indonesia could pull off the initiative it has suggested to deal with the issue if the rich countries agree is questionable. Jakarta has shown little ability to stop the annual fires that spew millions of tons of carbon into the atmosphere from burning forests for palm oil and pulp wood plantations. The environmental group Greenpeace points out that Indonesia destroyed an area of forest the size of 300 soccer pitches every hour between 2000 and 2005, the fastest pace of deforestation in the world. Also, in a bid to reduce its overdependence on oil, the government is rapidly switching oil-fired power plants to coal-fired ones, a move that will produce even more carbon emissions.

Nonetheless, President Susilo Bambang Yudhoyono made the plea on behalf of other tropical forested nations when he opened a two-day meeting in Bogor last week in which ministers representing 191 signatory states to the Kyoto Protocol met to discuss ways to tackle global warming.

Indonesia has around 120 million hectares of forest, all that remains following decades of destruction as well as unsustainable industrial logging. This still puts it in third place among the world's largest forested countries, after Brazil and the Democratic Republic of Congo.

The meeting, which ended Thursday, was also meant to set the stage for the biggest-ever global climate change conference, to be held in Bali in December with delegates expected from 190-odd countries, including the United States, which initially refused to attend until pressured by the European Union. The Bali talks will focus on post-Kyoto 2012 agreements. Further meetings are planned in Warsaw in 2008 and in Copenhagen in 2009.

Indonesia says developing countries should seek from US$5 to US$20 for every hectare of forest under a global framework on “avoided deforestation.” This is a term used to describe the prevention or reduction of future forest loss. The concept stems from the Stern Review on Climate Change headed by the economist Sir Nicholas Stern, which was commissioned by the UK government, and released in October 2006. It proposed that any post-Kyoto protocols should include “avoided deforestation” measures. The idea is that developing countries will attract funds from industrialized nations, at least those who have agreed to meet commitments under international agreements like the Kyoto Protocol, to pay them to prevent any further deforestation.

The World Bank also has released details of its proposed Forest Carbon Partnership Facility, a market-based mechanism that would compensate developing countries for avoided deforestation. It comprises a Readiness Fund, aimed at building carbon inventories for developing countries; and a Carbon Fund of avoided deforestation payments for a few selected countries. The proposed size for the Readiness fund is US$100 million and for the Carbon Fund, $200 million. The Bank will rely heavily on contributions from governments and the private sector to put the scheme into practice.

The 1997 Kyoto Protocol requires 36 industrial nations to reduce CO2 emissions by 5.4 percent by 2012, compared to 1990 levels. The protocol has not been ratified by either Australia or the US. Developing countries, including Indonesia, which ratified the protocol in 2004, do not have to reduce emission levels.

Indonesia prefers the option of including restoration of degraded forest areas along with voided deforestation, which it will propose at the Bali conference. Some of the other countries, however, have sought a consensus on restricting the scheme to avoided deforestation only, on the grounds that trying to measure degradation and ensuing restoration efforts would be impossible.

Climate change knows no borders and Indonesia risks a great deal because of global warming. Visiting Indonesia in March this year, Stern warned that, as an archipelago, the country could be among those most affected by climate change. The floods that hit Jakarta a month earlier were indicative of the problems the city itself could face from rising sea levels driven by climate change, Stern told local reporters. The country can also expect threats to food security due to the effects of climate change when sea levels rise and inundate productive coastal zones, affecting farming, and fish and shrimp farms.

The Stern report says that if unchecked the overall costs and risks of climate change will be equivalent to losing at least 5 percent of global GDP each year, now and into the future. If a wider range of risks and impacts is taken into account, the estimates of damage could rise to 20 percent of global wealth, around US$5 trillion.

Conversely, the costs of action – reducing greenhouse gas emissions to avoid the worst impact of climate change – could be limited to around 1 percent of global GDP each year or US$250 billion. Thus it would be cheaper for the rich nations to invest in helping developing countries to protect their forests rather than cutting their own emissions, which would mean shutting down factories and losing jobs.

Australia, one of the largest per capita producers of greenhouse gases, has been one of the first to recognize this simple reality and in July this year announced a US$160 million fund for both avoided deforestation and reforestation in the Asia-Pacific.

Yvo de Boer, head of the United Nations Climate Secretariat, said Thursday he was confident that the Bali conference in December would launch negotiations to be completed by 2009. Entrenched US opposition to mandatory emissions targets had attracted widespread criticism in the past.

Australia may also be about to reverse its stance on Kyoto. Prime Minister John Howard’s unswerving support for US President George W. Bush and his refusal to ratify the Kyoto Protocol have put the Liberal Party leader on the wrong side of public opinion. Elections due in late November could see a change of government to the pro-Kyoto Labor Party.

Nonetheless, the US and Australia are expected to demand that industrializing countries such as China and India to share the pain of cutting emissions.

Greenpeace is far from convinced about the Bogor meeting, noting in a press release that recent initiatives that promote “aspirational” targets and a voluntary regime are distractions from the real business of protecting the climate by strengthening and deepening the Kyoto Protocol post-2012.

Governments should not allow themselves to be led down this “road to nowhere,” it says.