A tree in the forest in North Sulawesi, Indonesia

Indonesia: Illegal logging is not only leading to rainforest destruction, but is also exacerbating poverty, causing human rights to be violated. Unless the Indonesian government can rein-in corruption, future efforts to stop deforestation (such as REDD) are likely to fail.

Human Rights Watch has just released a report titled Wild Money that details how rampant corruption in Indonesia’s forestry sector is negatively affecting human rights and governance.

Indonesia, home to the third largest area of tropical rainforest (outside of Brazil and the Democratic Republic of Congo) also has one of the world’s highest deforestation rates. Yearly exports from timber production are worth $6.6 billion, more than all of the African and Central American countries’ exports combined.

However, more than half of Indonesia’s timber was logged illegally. Illegal activities related to the forest sector include (but are not limited to) bribing forestry officials and police, obtaining logging permits and export permits through nefarious means, and logging protected areas.

The yearly losses as a result of illegal logging are greater than Indonesia’s total budget for health services – over $2 billion. It is also the amount of money it would take to provide basic health services to 100 million of Indonesia’s poorest people, according to The World Bank.

Illegal logging is disenfranchising rural forest communities, of which many depend on the forest for their livelihoods. With such entrenched corruption – pervasive throughout the police, military, government. and judiciary, illegal logging is contributing to poor governance.

By not having this timber go through proper channels, the Indonesian government is losing a staggering amount of money in lost tax revenue. The breakdown of this number can be seen in the figure below:

Source: "Wild Money" Human Rights Watch

Another side effect of this issue is the staggering loss to biodiversity due to the destruction of the forest. Indonesia is home to 20% of the world’s plant and animal species, despite having only 1.3% of the planet’s land mass.

Outside of human rights and governance effects, these findings have implications related to efforts to mobilize international carbon finance to combat global warming. Reduced emissions from deforestation and degradation (REDD), is a proposal for developed countries to pay developing countries to not cut down their forests. Currently deforestation and other land use changes account for up to 20% of greenhouse gas emissions, and are seen by many as a relatively inexpensive way to tackle climate change.

However, there are many concerns with how REDD will work in practice, namely, to whom these payments to preserve the forest will go and how this may be a source of conflict.

Human Rights Watch concludes that:
“Without dramatic improvements in the governance of Indonesia’s timber sector, including improvements to transparency and enforcement of forestry and anti-corruption laws, investors can have no confidence that the offset payments will in fact go to the preservation of forests as a means to avoid carbon emissions rather than to further fund a deeply mismanaged and corrupt system.”

The takeaway point for me is that strong efforts are needed to reduce deforestation in Indonesia to preserve biodiversity, mitigate climate change, and protect the rights of forest communities. REDD is an option to that could contribute to this effort, however, it is doomed to failure unless dramatic improvements in forest governance are made, and corruption in this sector is rooted out.

Source: Human Rights Watch