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Dispatches: A Veneer of Legality for Indonesia’s Timber Trade?

A long-awaited agreement signed on Monday by Indonesia and the European Union to trade only in legal timber is a critical first step toward reform of Indonesia’s notoriously corrupt forestry sector. But there are still miles to go before both sides can claim “zero tolerance for illegal logging and its associated trade” as asserted by Indonesia’s Forestry Minister Zulkifli Hasan.

Indonesia’s vast and biodiverse forests are globally important, yet the country is plagued by rapid deforestation. Indonesia is one of the largest emitters of carbon, largely because of the illegal practice of burning forests to clear land for plantations. Every dry season, smoke from these fires blows into nearby Singapore and Malaysia, creating a high-profile environmental and political crisis.

The impacts of Indonesia’s rampant illegal deforestation are also felt close to home. Our analysis of Indonesia’s own data shows that in 2011 the country lost more than US$1 billion in uncollected taxes due to illegal logging. That loss is roughly equal to the value of all Indonesia’s wood exports to the EU and to Indonesia’s entire national health budget for that year.

While a welcome beginning, Indonesia’s new timber legality certification system is deafeningly silent on routine violations of the rights of communities living in and around forest concessions. Companies infringe upon community rights when they fail to comply with land compensation agreements, and the government does so when it allocates concessions on community land. Earlier this year, Indonesia’s Constitutional Court ruled the latter practice unconstitutional. Nevertheless, wood products harvested on community land, without compensation, can still be stamped “V-Legal” under the system, and fast-tracked for export to the EU.

These violations of community rights have serious consequences. Impoverished rural communities depend on farming and collecting forest products – livelihoods that are destroyed when land is converted to plantations. Land conflicts are multiplying, and often become violent, as the government’s “green development” plan aggressively expands plantations of pulp trees (for paper) and oil palm (for biofuel).

The EU should indeed have “zero tolerance” for timber imports linked to violence and rights violations. The new trade agreement should not serve as a veneer of legality for wood produced under such conditions. 

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