Presentation by Mubariq Ahmad

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Ahmad Mubariq, Executive Director - Indonesian Ecolabelling Institute - Indonesia.

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  • Increase in world demand is estimated 60 mio tons by 2020.
  • Increase in world demand is estimated 60 mio tons by 2020.
  • Increase in world demand is estimated 60 mio tons by 2020.
  • Increase in world demand is estimated 60 mio tons by 2020.
  • Increase in world demand is estimated 60 mio tons by 2020.
  • Increase in world demand is estimated 60 mio tons by 2020.
  • Increase in world demand is estimated 60 mio tons by 2020.
  • Presentation by Mubariq Ahmad

    1. 1. NGOs-Private Sector Engagement from Forest and Plantation Sectors: L essons-learned Dr Mubariq Ahmad Executive Director WWF-Indonesia Presentation at TBLI Conference Bangkok, 26 May 2006 *the presentation is prepared by Dr Mubariq Ahmad and Fitrian Ardiansyah
    2. 2. Forests in Indonesia <ul><li>Loss: 162 million ha (1950)  98-109 million ha (2003) </li></ul><ul><li>Degradation: >3 million ha/year </li></ul><ul><li>Critical condition: 59 million ha (inside & outside forests) </li></ul><ul><li>Forest dependent people: 48 million </li></ul><ul><li>Causes: </li></ul><ul><ul><ul><li>Increase in population, infrastructure development, forest and land fires, logging and plantation concessions , mining, etc. </li></ul></ul></ul>
    3. 3. E.g. Tropical Forest Loss in Sumatra 1900-2010 ( Worldbank, 2002 ) Hectare (juta) 1900 Forest Cover 2000 Analysed from satellite image, others are estimation Similar situation may happen in Borneo and Papua 1900 2010 Montane Swamp Lowland 1960 2000 1960 1980 2000 1980 2010
    4. 4. Corporate Sector: “ PART OF PROBLEMS AS WELL AS SOLUTIONS ”
    5. 5. Finance Side Supply Side Demand side Market Influencing Forces NGOs media universities state/ government processing industry primary sector retailers banks Supporting industry & communities “ Sustainability can only be achieved if everyone involved works together” consumers standards labels
    6. 6. WWF‘s Approach: With People Achieving Win-Win Solutions Consumers Politicians/ govern-ment People in the field Corpo-rates/Fi-nanciers
    7. 7. CASE A: Green Investment Screening (i) <ul><li>Helping banks to avoid some associated risks (overall business, operational, compliance liability and reputation risks, etc.) in investing in the sectors (by developing manual/handbook for credit officers) </li></ul><ul><li>Involving timber and oil palm plantation industries, customers and banks </li></ul><ul><li>Bank’s financial power as lever for change: embracing good forest and plantation companies and reject those who destroy or degrade forests </li></ul>
    8. 8. <ul><li>Partners: ProFundo, HSBC, ING, Ministry of the Environment (MoE), IPOC (Indonesian Palm Oil Commission) </li></ul><ul><li>Discussions have taken place with Bank Indonesia (central bank) with the help from MoE </li></ul><ul><li>Challenges: </li></ul><ul><li>Wider acceptance from national/local banks </li></ul><ul><li>Different procedures adopted by banks in screening and risks management </li></ul>CASE A: Green Investment Screening (ii)
    9. 9. CASE B: Pulp & Paper Industry Engagement (i) <ul><li>APP & APRIL (2 biggest pulp & paper industry in Indonesia) accommodate the demand of their customers and financiers in protecting HCVF (high conservation value forests): </li></ul><ul><ul><li>APP completed HCVF assessment in its 3 concessions (± 150,000ha), and agreed to protect HCVF in its 4 concessions (± 100,000 ha) in Riau, Sumatra. </li></ul></ul><ul><ul><li>APRIL completed HCVF assessment in its 3 concessions (> 300,000 ha) in Riau. </li></ul></ul>
    10. 10. <ul><li>Challenges </li></ul><ul><li>Ensuring sustainable fiber supplying capacity; demands on lands compare with the utilisation of abandoned lands </li></ul><ul><li>Bridging the financial recovery gap - default risk vs accepting longer repayment term over sustainability path </li></ul>
    11. 11. CASE C: Indonesian FTN/ Forest and Trade Network (i) <ul><li>Parts of Global FTN, promoting partnership between NGOs and companies to improve the quality of forest management (using step-wise approach towards certification). </li></ul><ul><li>Some examples: </li></ul><ul><li>Through Indonesian FTN, Bank Ekspor Indonesia (BEI) supporting Falak Jaya Furnitama (FTN member) to achieve manufacturing and purchasing of sustainable forest products </li></ul><ul><li>(potential collaboration with other members to be explored) </li></ul><ul><li>IFC PENSA assisting Inhutani and small scale industry (CV Kwas, supplied by Inhutani) to be member of Indonesian FTN to achieve sustainability </li></ul>BEINEWS , Edisi 28, 2005
    12. 12. CASE C: Indonesian FTN/ Forest and Trade Network (ii) <ul><li>Challenges: </li></ul><ul><li>Limited sustainable forest products (certified or in progress) to supply the market demand </li></ul><ul><li>Processes to achieve FSC (credible) certification is more challenging and usually takes a long time </li></ul><ul><li>Promoting other concessions to join Indonesian FTN </li></ul><ul><li>Willingness to pay for the premium has a limit </li></ul>
    13. 13. CASE D: Palm Oil (i) <ul><li>RSPO (Roundtable on Sustainable Palm Oil), a multi-stakeholder initiative incorporating producers, buyers, retailers, financiers and NGOs in the palm oil sector – succeeding to ratify Principles and Criteria on Sustainable </li></ul><ul><li>Palm Oil </li></ul><ul><li>Mega plan (1.8 million ha, the border in Kalimantan/ Heart of Borneo); associated with CDB (Chinese Development Bank) and CITIC; </li></ul>RSPO Roundtable on Sustainable Palm Oil
    14. 14. CASE D: Palm Oil (ii) <ul><li>Current status of the mega plan: </li></ul><ul><li>Indonesian government agreed not to plan oil palm in the HoB area and only use abandoned lands </li></ul><ul><li>CITIC agreed not to invest in HoB area and only use non-forested lands with clear permits </li></ul><ul><li>Challenges: </li></ul><ul><li>Furthering joint work on the ground on HCVF assessment and protection as well as better practices in plantations </li></ul><ul><li>Mobilizing other financial institution to take the same position </li></ul>‘ Sustainable Palm Oil Products’
    15. 15. Kantor Taman A9/Unit A1 Jl. Mega Kuningan, Jakarta 12950 INDONESIA (Ph):+62-21-5761070, (Fax):+62-21-5761080 www.wwf.or.id For further information please contact: Dr Mubariq Ahmad (Executive Director) and/or Fitrian Ardiansyah (Program Coordinator, Forest Restoration & Threats Mitigation) Email: [email_address] and/or [email_address] .id/ www. wwf.or

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