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World Bank Indonesia
Since the Bali UNFCCC Conference of Parties (COP13), Indonesia has made climate change action a priority. In May 2010, Indonesia agreed with Norway on a path-breaking, performance-based initiative for action on REDD+. In January 2011, the Government of Indonesia identified two provinces that will pilot the REDD+ partnership agreement with Norway. However, much remains to be done to prepare sub-national financing instruments that transmit incentives from international REDD+ funding sources to regional and local levels. Financing mechanisms will need to be in place for programmatic activities as well as for project type approaches, and appropriate methodologies for disbursement of benefits and carbon accounting will need to be developed. Importantly, the design of financing mechanisms needs to fulfill requirements for efficiency, equity and effectiveness, and needs to fit into the national and sub-national institutional and legal framework.
This activity drew on the existing international body of knowledge regarding Payments for Ecosystem Services, REDD+ financing, transfers, and benefit sharing both internationally and in Indonesia. Combined with an analysis of current fiscal mechanisms in Indonesia and lessons from REDD+ demonstration activities, the synthesis provided lessons that are relevant for developing an Indonesian REDD+ financing architecture -- and for developing REDD+ financing mechanisms in other countries.
Policy briefs were developed in presentation format on issues related to financing mechanisms and shared with key REDD+ stakeholders and policy makers in Indonesia (some of the presentations are available on this page). Background papers were developed on PES as a Mechanism for REDD+ Benefit Sharing in Indonesia; Green PNPM as a REDD+ Benefit Sharing Mechanism in Indonesia; and The Role of Small Grants Programs in REDD+ Readiness and Implementation. These were consolidated into a single report that underwent World Bank peer and virtual review in September 2012 and is available as a working paper on this page: Integrating Communities into REDD+ in Indonesia.
Author : World Bank Indonesia
Last Updated : 02-24-2017
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In Indonesia, the question of forest and land ownership is legally complex. Indonesia’s post-independence land legislation, based on colonial practices, has continued to assign rights and allocate forest and land resources in ways that exclude or marginalize local people, especially historically disadvantaged groups such as indigenous peoples and isolated communities. Approximately 70% of Indonesia's land is classified as forest zone and thus claimed by the state. Although only about 11% of this total land area has been legally verified and gazetted as state forest land, in practice, it remains under state control, despite contested and competing claims from communities, indigenous peoples, forest concession holders, and even local governments. Insecure land tenure has long been known as a factor that impedes proper natural resource management. Conflicts over land, for example, have contributed to the incidence of fire, and are recognized as a barrier to Indonesia’s ability to attract investment for continued growth.
In addition, natural resources, such as land and water, are not only the sources of livelihoods for many indigenous peoples but also a source of their identity. The indigenous peoples' close relationships with their surrounding ecosystem have resulted in complex traditional tenurial arrangements and management regimes that are often at odds with the formal legal structures of the Indonesian state. This situation of competing claims to rights and ownership over forest lands complicates discussions on how benefits will accrue from climate change responses such as REDD+.
These issues go well beyond REDD+ and forest carbon/climate mitigation issues, but the institutional engagements and dialogue processes around REDD+ have recently created an opportunity for more concrete and open discussions with some real potential for progressive action. A consortium of NGOs, led by Epistema Institute, as well as institutional partners and think tanks, has developed a Tenure Road Map for addressing land conflicts and improving land tenure. The Ministry of Forestry has now formed a working team for preparing a forestry macro tenurial plan including some of these organizations, together with the World Agroforestry Centre and some of the opinion leaders in this field. At the same time, the indigenous peoples’ organization, AMAN, has developed a concept for a registry of ancestral domains (Badan Registrasi Wilayah Adat, BRWA). Parliament is also considering a draft law on indigenous rights as well as other legislation and regulations that would need to be assessed as part of the reform process.
The ultimate resolution of these issues will be a process, not a declaration or a ruling. After addressing basic legal issues, the unfolding process will continue to encounter difficult and costly implementation issues, such as the need for national scale mediation and adjudication processes, institutions, and legal aid organizations; the need to build capacity in the legal system to understand, address and defend new bundles of rights resting with previously marginalized stakeholders; and the need to build the capacity of the local communities themselves (and their civil society advocates, advisors and service providers) to articulate and defend their rights and claims.
Access to potential REDD+ resources in the future is making it worthwhile for stakeholders to address and begin to resolve these thorny issues. There is now an opportunity for a focused investment in continued dialogue and analysis that can contribute to consensus around some legal issues, practical tools, and ways forward. The activity drew on the existing work that civil society and indigenous organizations were developing (land tenure road map) in coordination with the Ministry of Forestry (MoFor) and the National REDD task force and combined this with analysis of successful experiences related to customary land rights recognition happening in Indonesia.
This activity developed knowledge products and supported consultative dialogue processes related to the inclusion of marginalized and indigenous communities in emerging forest, REDD+ and land tenure dialogue processes. Activities were closely coordinated with the Aliansi Masyarakat Adat Nusantara (AMAN), the National Forest Council, the civil society organizations (CSOs) working group on land tenure, MoFor, and other think tank institutions and stakeholders.
The analytical products, which were prepared through consultations, highlight the main issues and opportunities related to customary land rights recognition and benefit-sharing mechanisms in Indonesia. Findings present the case that the recognition of customary tenure rights has contributed to indigenous communities playing an increasingly important role in forest and biodiversity preservation, which enables the regulated use of forest resources and respect for customary and traditional practices and laws. Consequently, these communities have become major players and partners in the overall sustainable management of resources and nation building. Overall, the data suggests that forging the middle ground in administering indigenous land requires a mix of policy, regulation and support for grassroots change through community-based efforts. These changes should empower the weak and marginalized, enhance the quality of lives of millions of unsecured indigenous landholders through reforms, and increase public confidence in the land administration system.
Last Updated : 11-09-2017
Many developing countries are proactively seeking to identify opportunities and related financial, technical, and policy requirements to move towards "green growth" on a low-carbon path. With the support of ESMAP, the multi-donor Enegery Sector Management Assistance Program hosted at the World Bank, selected pilot countries have initiated country-specific studies to assess their development goals and priorities, in conjunction with GHG mitigation opportunities, and examine the additional costs and benefits of lower carbon growth. For some of these pilot countries, addressing issues in the forest and land-use sector play an important role for developing low-carbon growth strategies. Because results have been provided until now in an aggregate manner, a detailed analysis of the forestry and land-use sector have not been separately presented. However, such an analysis would provide important information and guidance to develop low-carbon growth strategies for many other countries where forestry and land-use change are key GHG emissions sources. Such knowledge will be especially important for guiding work in developing countries financed by the World Bank, one of the most important implementing institutions of new programs promoting sustainable forest management for GHG mitigation (FCPF, FIP, BioCF, UN-REDD, etc.)
PROFOR will finance ESMAP's effort to produce a policy brief analyzing the role of forests and forest management for developing and implementing low-carbon growth strategies, including financing options related to low-carbon growth. While the policy brief will build on experience and data analyses already undertaken in key pilot countries (Mexico, Indonesia, Brazil), they will provide general guidance on the integration of forestry in low-carbon growth strategies beyond the case study examples.
The policy brief is expected to serve decision makers and World Bank operations "task team leaders" in developing and implementing forestry-based low-carbon growth strategies for countries with significant GHG emissions from the forestry sector.
This activity is ongoing. Results will be shared on this page when they become available.
Author : Energy Sector Management Assistance Program ESMAP 
Last Updated : 02-14-2018
This project was carried out by CSIRO with support from PROFOR and AUSAID as a part of an ongoing project (Developing Tools for Modeling the Impacts of Macro-economic Policies on Local Livelihoods and Natural Resources).
The main output of the project is an Agent-Based Modeling (ABM) tool that could potentially lead to a better understanding of the linkages between forests, livelihoods, and national policies, and could also be used to investigate questions of interest to planning, management, and budgeting agencies concerned with natural resources management and sustainability.
During this particular project in East Kalimantan, Indonesia, PROFOR supported a survey of 3,000 households across six districts in the southern half of the province and detailed interviews of 540 households in the area, and funded analytical and descriptive work as well as activities that strengthened collaboration with stakeholders from government and civil society.
The household survey was designed to provide data about household use of a range of natural resources as well as information about the values that people place on them. Household interviews were used to identify households’ changes in natural resource use in response to rising energy prices. While designed largely to develop behavioral response functions as a base for the agent-based model, the survey provides valuable stand-alone information. A key finding from the survey is the high proportion of households that use or value natural resources in the study area.
Based on the workshop response, regional policy makers are now engaged in the modeling process from the ground up. They anticipate that the agent-based model will benefit local governments (specifically the provincial level economic development planning agency (Bappeda) by providing an analytical tool for understanding the consequences of macro-policy decisions on dynamics within a region. The model is spatially explicit, enabling users to analyze economic, social and environmental dynamics between and within districts. It provides a tool for regional planning in the context of macro-policy decisions and will quantify results in diagrams, and visualize results in maps.
A baseline analysis of users’ impressions and project impact (May 2008) found that policy makers were engaged in the process, interested in the results, and ready to commit staff time to apply the models and incorporate findings into NR planning processes.
Author : CSIRO, AUSAID, PROFOR
Last Updated : 05-23-2017
Indonesia Forest Climate Alliance
Analysis of the Potential for Reducing Carbon Emissions from Deforestation and Degradation (REDD) in Indonesia
In 2007, Indonesia was committed to Reducing emissions from deforestation and forest degradation but was aware of outstanding methodological and financial issues that could stand in its way.
The Indonesia Forest Climate Alliance (IFCA), a study group consisting of Ministry experts as well as researchers from a range of national and international institutions, was created to provide research inputs with support from a core group of donors, including PROFOR, the World Bank, the UK Department for International Development (DFID), the Australian Government and Deutche Gesellschaft fur Technische Zusammernarbeit (GTZ).
The objective of the analysis was to clarify possible strategies for REDD in Indonesia‘s major forest land use types and identify pilot projects for testing the potential of “avoided deforestation” payments. It analyzed the reduced level of emissions that could be anticipated through introduction of improved land use and land conversion strategies in five forest land use categories, namely: protected areas, production forests, forests being managed to provide raw material for the pulp and paper industry, for the oil palm industry and in peat lands.
PROFOR made a significant contribution to financing a series of nine multi-stakeholder studies that assessed options for adjusting historical approaches to forest conservation, sustainable forest management and forest land use.
These studies analyzed how adjustment to forest conservation and land use strategies could lead to quantified and verifiable reduction in carbon emissions. Strong emphasis was given to linking climate change REDD initiatives to conservation and development strategies that would address poverty alleviation by engaging local communities as beneficiaries of programs for effective management of protected areas, for sustainable management of natural forests and for establishment by local communities and small holders of plantations and agro forestry crops such as oil palm on non forest and degraded lands.
- strengthened capacity for measurement and monitoring of forest change and carbon emissions,
- further exploration of potential carbon buyers and sellers,
- strengthened capacity for more effective forest governance (aimed especially at containment of illegal logging).
They also included provision for further development and testing of REDD payment distribution mechanisms. The studies identified criteria and principles for the selection of pilot projects for implementation between 2009 and 2012 that would create opportunities to test the effectiveness of those land use strategies that would be most likely to slow deforestation and degradation.
Author : Indonesia Forest Climate Alliance
Last Updated : 02-24-2017