Joe Leitmann, The Jakarta Globe
The arrival of a new government in October is a tremendous opportunity for Indonesia to move toward a more sustainable development path — a path in which the costs of degradation no longer cancel out economic growth; the poor are no longer the greatest victims of environmental damage; renewable resources are used sustainably; and the public proactively tackles the issues plaguing the environment.
A five-part win-win agenda can help Indonesia move toward greater sustainability. The first part entails reducing policy distortions that arise from conflicting regulations and national laws, especially those involving decentralization.
Fuel and electricity subsidies have hampered the use of clean energy and mostly benefited the well-off. The existing legal and financial framework has not been effective in curbing illegal logging or slowing down deforestation as well as degradation.
Policy distortions in fishing and mi ning have contributed to unsustainable harvesting patterns and illegal mining activities. These policy distortions could be overcome through a reform that uses taxation and pricing instruments that raise revenues, and also provide incentives for more sustainable behavior.
The second agenda item involves building constituencies, awareness and critical partnerships, which are essential for creating effective demand for environmental sustainability.
Environmental issues are very much on the radar screen of the Indonesian population, especially those concerning water (pollution, floods, droughts), cities (cleanliness, solid waste, air quality) and forests (degradation, illegal logging, fires). Yet the government is pursuing areas that are not yet public priorities, eg climate change, clean energy and hazardous waste, indicating a low level of public awareness. In order to bridge environmental communications between the government and the public, stronger partnerships are needed with four key actors: the mass media, civil society organizations, the legislature and religious organizations.
Third, adaptation to climate change needs to become a higher priority. People and ecosystems in Java, Bali, parts of Sumatra and a large area of Papua are especially vulnerable to climate risks such as droughts, floods, landslides and rising sea levels.
Climate change will have the most impact on the poorest Indonesians, who are more likely to be living in marginal areas that are susceptible to drought, flooding and/or landslides; dependent on climate-sensitive agriculture or fisheries for their livelihoods; and have fewer assets to cope with the impacts of a changing climate. Many adaptation options exist to help reduce Indonesia’s vulnerability to climate change, which will need to be phased in and prioritized according to the magnitude of costs, benefits and risks.
The fourth point deals with mitigating emissions from forestry and land use. High rates of deforestation, illegal logging, forest fires and peatland degradation make up the single largest source of Indonesia’s greenhouse gas emissions and have made the country one of the world’s principal emitters.
Well-known options exist that should be pursued regardless of climate benefits, ie improved forest law enforcement, management and governance, realigned incentives for timber harvesting and processing firms to improve sustainability, restructuring and revitalization of forest sector industries, forest and land fire control, and greater equity and transparency in forest/land use decisions.
Forest climate finance schemes such as Reducing Emissions from Deforestation and Degradation (REDD) can provide an important incentive for these “no regrets” options.
The fifth and final agenda item involves pursuing a low-carbon growth strategy. In the future, fossil fuel emissions will be a greater concern than land use emissions.
With current subsidies, Indonesia uses fuel and electricity inefficiently and in excess. However, Indonesia has the world’s largest potential for developing geothermal power and sustainable biofuels.
Industry is currently the largest source of energy-based emissions, the transportation sector is the largest user of liquid fuels and petroleum is currently the main contributor to CO2 emissions. Even assuming lower energy intensity, emissions from energy consumption will triple by 2030 from 2005 levels.
Mitigating these emissions will require more realistic energy pricing, development of renewable energy resources and greater efficiency in the industrial, power, manufacturing and transportation sectors; ie a low-carbon growth strategy where the economy expands while emissions per rupiah of GDP decline.
The World Bank has a long history of partnership with Indonesia on environmental and natural resource management issues. There are now new and urgent opportunities for increased partnerships in the areas of environmental governance and climate change that could help Indonesia develop an economy that grows while nurturing the environment that sustains it.
Dr. Joe L eitmann is the World Bank’s environment coordinator for Indonesia