The good news

As reported in this blog last week, new rules governing the distribution of foreign donor aid under the REDD scheme had been delayed. It was however announced earlier this week that the new rules, as well as the new climate change fund, would be ready before the Bonn climate change talks in June. Agus Purnomo, former head of the WWF in Indonesia and speaking on behalf of the DNPI (National Board on Climate Change), stated that it was issues over taxation on profits and Indonesia’s bureaucracy that was putting investors, and especially private businesses, off investing in Indonesia but the new rules should address these concerns. Add to this the announced 70 approved CDM projects and it appears that the Indonesian government is finally building up some momentum in the climate change realm. While I share this blogger’s concern over how much of the money will be put into effective climate change policies, it is hoped that the rules will provide a clear explanation of how the money will be spent, thereby encouraging investments.

 

Now the Bad news

It has always been the presumption that billions of dollars will flow into the Indonesian economy once these rules had been formulated. However it appears that the global economic crisis could claim yet another victim. Mahendra Siregar from the Adaption Fund Board at the United Nations Framework Climate Change Convention (UNFCCC) was adamant: “the idea that Indonesia will finance its climate change programs on foreign money generated from the signing of the Kyoto protocol is a fantasy. No amount of foreign funding would be enough to deal with Indonesia’s climate change problems.” Add to this a collapse in the price of CO2 and a drive within companies to reduce operating costs, means payments into the UN Adaption Fund may not be what developing countries are hoping for. Indeed Mahendra speculates that instead of billions of dollars, the entire adaption fund would only amount to $150 million split between all developing countries. Indonesia’s budget for climate change in 2009 is Rp 1.8 trillion (US$ 200 million) and relied on a sizable investment from the Adaption Fund.

 

What to do? Local community engagement

So if international donor money does dry up, what can be done? One suggestion is engaging with local communities two ways. First of all, local engagement can reduce deforestation caused by palm plantation. And it need not be expensive. Yayasan Orangutan Indonesia, an Indonesian NGO dedicated to saving the orangutan, provides education and information to villagers explaining the dangers local communities face to their environment if they sell land to palm oil cultivators. Once explained what impact these plantations have, the communities are much more likely to refuse payments for land, thereby preventing deforestation.

 

Secondly, reforestation projects could utilize local labour and knowledge, along with direct private funding, thereby cutting out the multiple layers of government. A good example of this is the WWF NEWtrees scheme, created in conjunction with Nokia and Equinox Publishing. Originally launched in November 2007 in Sebangau National Park, Kalimantan, it initially planted 100,000 trees with Nokia providing the trees and tagging technology. This week, the scheme was extended to Mt. Rinjani, East Lombok hoping to replenish the 40000 hectares of deforested land. In collaboration with the local communities, the program hopes to help the 3 million people who have been directly affected by deforestation.

 

These programs and schemes highlight simple, effective ways to tackle climate change. By engaging with local communities and addressing their livelihood issues, climate change can be tackled at the local level at minimal expense. Whether schemes like this will be rapidly expanded in the coming year remains to be seen, but the global economic crisis should not be used as an excuse for inaction.

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