A new report by environmental campaigners Greenpeace has revealed that a land area eight times the size of Bali has burned in Indonesia in the last five years, as the nation continues to drag its heels over reining in industries devouring its tropical forests.
To continue reading, subscribe to Eco‑Business.
There's something for everyone. We offer a range of subscription plans.
- Access our stories and receive our Insights Weekly newsletter with the free EB Member plan.
- Unlock unlimited access to our content and archive with EB Circle.
- Publish your content with EB Premium.
Coming on the heels of a contentious new job creation law slammed by activists for its potential to fuel environmental and social harm, the analysis casts a spotlight on some of Indonesia’s most destructive firms and the government’s failure to hold them to account.
The report, titled Burning Issues: Five Years of Fire, finds that the country’s plantation sector bears considerable responsibility for forest and peat fires in the period from 2015 to 2019, with 30 per cent out of the 4.4 million hectares (ha) of mapped razed areas located in palm oil and pulpwood concessions.
Greenpeace blames Indonesia’s poor law enforcement for the recurring crisis, stating that the government has failed to uphold pledges to prevent fires and punish companies behind the blazes, made after the catastrophic fire episode in 2015.
Broken promises
Indonesia’s 2015 fire season, which destroyed 2,6 million ha of land, was its worst in nearly two decades, with the blazes generating more carbon dioxide emissions than the United States’ entire economy for almost a month.
They also shrouded much of Southeast Asia in toxic haze that resulted in an estimated US$16 billion in economic losses and caused respiratory illnesses in hundreds of thousands of people across the region, sparking a diplomatic row with neighbouring Singapore and Malaysia.
Deliberate fire setting to clear land for oil palm plantations was identified as a likely factor contributing to the disaster. The technique—commonly known as slash-and-burn agriculture—has long been practised by small farmers in Indonesia, but it was not until industrial oil palm growers began to employ it in the 1980s that the problem spiralled out of control.
In response to the crisis, the government vowed to impose strict accountability measures on corporations responsible for preventing fires on land under their management to avoid a repeat of the event.
But in 2019, blazes once again flared up across large swathes of forest inside companies’ concessions, laying waste to 1.6 million ha of land—27 times the size of Greater Jakarta—making it the worst fire season since 2015.
Government-data shows that plantation firms responsible for the worst of the fires have largely evaded criminal charges and continue to operate with few or no serious sanctions, despite repeated fires within their concessions, states Greenpeace, although the group admits the data available is incomplete.
A case in point is that four of the five companies that saw the most land burn over the five-year period have not received any government sanctions. Meanwhile, all 10 palm oil corporations with the largest fires in their concessions had blazes on their land in multiple years.
In the pulp sector, four of the five companies whose concessions suffered the largest blazes across the whole period received sanctions related to deliberate fires between 2015 and 2018. Yet all of them still saw parts of their lands burn in 2019, and none were sanctioned that year, shows the study.
Greenpeace points to the power wielded by industry associations as a key factor behind the lack of progress. It stresses that such groups influence policy and political decisions in their favour, undermining efforts to bolster forest and peat protection as well as law enforcement commitments.
“Palm oil and pulp multinationals have practically set the rules in recent decades. Year after year they have broken the law by allowing forests to go up in flames, yet they evade justice and go unpunished,” said Kiki Taufik, global head of Greenpeace Southeast Asia’s forest campaign.
For example, Gabungan Pengusaha Kelapa Sawit Indonesia (GAPKI), one of the country’s biggest palm oil associations, was reportedly instrumental in preventing the government from ratifying a region-wide agreement aimed at reducing transboundary haze pollution in 2002, reads the report.
In 2013, the group also opposed a plan to extend a moratorium on new forest concessions, and in 2014 and 2016 it joined forces with the Association of Indonesian Forest Concession Holders (APHI), another major palm oil industry group, to challenge a new draft regulation on peatland management.
Firms respond
Among pulp businesses, three of the five biggest alleged fire offenders are linked to the Widjaja family, who control the Sinar Mas group, one of the largest conglomerates in Indonesia, and pulp and paper company Asia Pulp & Paper (APP).
Commenting on the findings, an APP spokesperson told Eco-Business it had been working closely with affected suppliers to prevent forest fires since 2015. As such, none of the licenses of these companies had been terminated by the government.
She said 23 of APP’s suppliers had received administrative sanctions between 2015 and 2018, mandating them to assist with investigations and provide detailed reporting to prove regulatory compliance. But as of December 2019, all sanctions had been lifted following the fulfilment of obligations.
Greenpeace’s report, however, identifies a total of 33 sanctions imposed on APP suppliers over the five-year period, including 3 in 2019. The spokesperson said there had been no sanctions handed out to APP or its suppliers in 2019, adding it was unclear how the group had arrived at the figure.
Asia Pacific Resources International Limited (APRIL), Indonesia’s other pulp and paper giant, whose suppliers are also listed among top offenders, said in a statement that it disagreed with the allegations, as its field-verified data indicates 1,912 ha of land burned between 2015 and 2019, an area about five times smaller than Greenpeace’s estimate.
The company noted the group might have overestimated the fire data due to technical issues and the methodology applied. In its report, Greenpeace responds to these claims, which APRIL had already put forward in response to previous studies, explaining that it uses “the latest official data from the Indonesian government” and that inaccuracies should be resolved between the firm and the government.
Of all palm oil firms, Greenpeace finds that South Sumatra-based PT Samora Usaha Jaya saw the largest area engulfed in flames, with its biggest fires to date occurring in 2019, razing 17,500 ha of land. Not surprisingly, its parent group, Sungai Budi/Tunas Baru Lampung, is the palm oil group with the most burned area across its holdings. Eco-Business has reached out to the group for comment.
New threats
The report comes two weeks after President Joko Widodo passed the controversial pro-business ‘Omnibus Law’, which activists say threatens to weaken environmental safeguards and exacerbate fire risks as it lowers the standards to which firms are held when opening up new areas for their plantations.
Greenpeace criticises the involvement of vested interests in the law’s creation and the absence of public consultation. The group highlights that palm oil and pulp business associations sat on the task force charged with drafting the bill, enabling them to influence its design to the benefit of their operations.
“When the Government gave palm and pulp business companies a role in drafting this bill, it was like giving a hungry fox the keys to the hen house. Now they can act with even greater impunity,” Greenpeace’s Taufik stated.
He cautioned that the law not only rolled out a “red carpet” for further forest destruction but, in enabling corporations to violate human rights and environmental commitments, also jeopardised Indonesia’s competitiveness in the global market.
He cited a letter signed by 35 global investors managing US$4.1 trillion in assets which warned Indonesia’s government that the bill “could hamper efforts to protect Indonesia’s forests, which would in turn undermine global action to tackle biodiversity loss and slow climate change”.
“Indonesia is now a risky bet for corporations, investors and importing countries that can only expect criticism. There is a heightened environmental and social risk tied to operating in a country that has taken a massive step backwards in the fight against climate change,” Taufik said.
