Conservation International - Sustainable Landscapes Partnership in Indonesia

Sustainable Landscapes Partnership g in Indonesia Conservation International Indonesia March 2016

L O W - E M I S S I O N D E V E L O P M E N T

F O R E S T & W I L D L I F E C O N S E R V A T I O N

ECO NO M I C GRO WTH

We envision Indonesia as a sustainable landscape where natural capital is maintained through appropriate land-use, sustainable production practices, and inclusive decision-making for the improvement of human well-being.

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INDONESIA AND GLOBAL CHALLENGES 250 000 000

Current population of Indonesia

68 % Indonesia’s landmass that is forested

6

Primary forest cover loss ha between 2000 - 2012

million

600

FMU

Forest Management Units planned across the country

Area (Ha) of forest and land burnt by fires

2015 fires

1

.7million

50 million tons

Global palm oil production, of which 60% is produced in Indonesia

Deforestation component of Indonesia’s CO2 emissions

Global green bonds (in US$) to be issued in 2015

37

%

$ 40

b i l l i o n 3

S LP F RAM EWO RK | GO V ERNANCE |

N A T U R A L C A P I T A L | S U S T A I N A B L E P R O D U C T I O N |S U S T A I N A B L E F I N A N C E

SLP FRAMEWORK AT A GLANCE Sustainable Landscapes Framework Governance

Good governance provides the overarching enabling environment including policy goals, planning processes and capacity to support coordinated and effective implementation across landscapes.

Natural Capital Natural capital is central to sustainable landscapes – sustainable production and human well-being that are derived from and dependent on ecosystem services.

Sustainable Production

Sustainable Finance

Sustainable production is largely derived from and dependent on natural capital, and is required to support livelihoods and other basic requirements of society and communities.

Landscape strategies should include a sustainable finance component to ensure long term viability of the program.

SLP collaborates with local partners to protect natural capital by promoting sustainable production practices, good governance and facilitating sustainable finance to ensure long-term benefits to people.

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S LP F RAM EWO RK | GO V ERNANCE |

N A T U R A L C A P I T A L | S U S T A I N A B L E P R O D U C T I O N |S U S T A I N A B L E F I N A N C E

WHERE SLP WORKS IN INDONESIA North Sumatra

West Papua

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N A T U R A L C A P I T A L | S U S T A I N A B L E P R O D U C T I O N |S U S T A I N A B L E F I N A N C E

WHERE SLP WORKS IN INDONESIA North Sumatra

West Papua

Currently 1.9 million hectares of forest (25% of land) with an annual deforestation of around 1%.

Currently 9 million hectares of forest (90% of land) with an annual deforestation of less than 0.1%.

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S LP F RAM EWO RK | GO V ERNANCE |

N A T U R A L C A P I T A L | S U S T A I N A B L E P R O D U C T I O N |S U S T A I N A B L E F I N A N C E

GOOD GOVERNANCE Key Governance challenges in Indonesia Limited capacity to implement strategic plans

Limited access to critical science to support decisionmaking

Science-based decision support tools Provide holistic frameworks for sound decision-making in land use planning and investments • Prioritizing landscape investments Sustainable Investment Action Plan • Characterizing sustainability through Landscape Accounting Framework (LAF) metrics and public datasets • Using LAF metrics to inform land use planning and investment decisions

Spatial planning conflicts between government levels

Lack of landscape level monitoring and enforcement

Lack of landscape level performance management and decision-making tools

SLP Initiatives Regional Policies, Programs and Spatial Plans Develop policies, programs and spatial plans using scientific evidence and consultative processes • Using Strategic Environmental Assessments as REDD+ safeguards • Aligning spatial plans with SEA recommendations • Designing conservation centric policies and spatial plans for SLP landscapes and watershed management

Multi-Stakeholder Forums Improve collaboration and policy alignment with public and private interests • Filling gaps in expertise in multistakeholder processes and partnerships • Filling gaps in local institutional arrangements and governance structures • Support and/or establish watershed forums

Outcomes • Sustainable Investment Action Plans (SIAP) prepared for 3 districts and the province of North Sumatra • LAF dashboards developed for monitoring landscape sustainability

• 3 SEAs developed in North Sumatra • Spatial plans developed • Establishing West Papua as a Conservation Province

• 17 palm oil companies pledge to adhere to best production practices • 2 Watershed Management forums supported in North Sumatra

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S LP F RAM EWO RK | GO V ERNANCE |

N A T U R A L C A P I T A L | S U S T A I N A B L E P R O D U C T I O N |S U S T A I N A B L E F I N A N C E

NATURAL CAPITAL Key Natural Capital challenges in Indonesia Limited resources and management capacity

Deforestation leading to fragmentation and biodiversity loss

Increased emissions due to forest and peat land fires

Lack of active forest management regimes in state forest areas

Social economic barriers to support protection

SLP Initiatives Protected Areas

Forest Management

Community Stewardship

Improve protection of high conservation value areas

Establish active professional management of the forest estate

Improve conservation practices at the village level

• Reviewing Protected Area status, risk and landscape corridors • Conducting Protected Area management effectiveness (PAME) assessments to guide interventions • Restoring degraded watershed areas • Developing capacity within Protected Area management & staff

• Reviewing institutional structures for forest management across Production forests and Protection forests • Assisting the Ministry of Environment and Forestry to implement Forest Management Unit (FMU) structures at provincial and district levels

• Promoting biodiversity corridors through village/ community forests • Establishing local/village regulations to protect key species (tigers, orangutans, turtles) & ecosystems (riparians /peatlands) • protecting of high conservation value areas through community driven development mechanisms

Outcomes • 12 protected areas have completed PAME assessments and set up the Spatial Monitoring & Reporting Tool

• Concept Note and recommendations for establishing FMUs for conservation objectives (KPH-K)

• Batang Gadis National Park conducted systematic biodiversity survey

• FMU Plan Development Toolkit available for other districts

• 6 Village forests and Community forests established in North Sumatra • 31 villages with Community Conservation Agreements (CCA) and on-going process in 12 villages

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S LP F RAM EWO RK | GO V ERNANCE

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N A T U R A L C A P I T A L | S U S T A I N A B L E P R O D U C T I O N |S U S T A I N A B L E F I N A N C E

SUSTAINABLE PRODUCTION Key Sustainable Production challenges in Indonesia Growing population pressure in Indonesia and globally

Limited access to information on market trends

F or estr y

Limited access to information on more sustainable practices

SLP Initiatives

Lack of capital for investment in better practices Agr icultur e

Sustainable forestry

Green Supply Chain investments

Agricultural Practices (GAP)

Provide active management of forest production

Improve market access and prices for sustainable farming

Promote and facilitate more sustainable practices

• Reviewing potential and market demand for timber and non-timber forest products (NTFPs) • Establishing management plan to support sustainable production • Rolling out of Forest Mgt Unit (FMU) Plan Development Toolkit

• Engaging private sector in sustainability challenges in their supply chains • Promoting deforestation-free supply chains and reducing risk of liability • Improving market access for farmers with good agriculture practices • Assessing crop suitability and projected impacts of climate change

• Conducting value chain analysis to identify poor practices & adverse impact • Developing farmer training modules with an emphasis on conservation practices • Providing farmers with access to better tools and methods

Outcomes • Mandailing Natal FMU now operational and equipped for timber production (KPH-P) and NTFPs • Production model amplified to other districts with designated KPH-P areas

• 3 companies supporting green supply chains for coffee, rubber and palm oil

• 5,500 farmers with nearly 40% yield increases

• Active stakeholder forum for addressing market issues

• Providing technical advice to 46 private organisations through various forums

• Crop suitability mapping completed

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S LP F RAM EWO RK | GO V ERNANCE |

N A T U R A L C A P I T A L | S U S T A I N A B L E P R O D U C T I O N |S U S T A I N A B L E F I N A N C E

SUSTAINABLE FINANCE Key Sustainable Finance challenges in Indonesia Districts and communities highly Limited recognition of ecosystem reliant on government budget services in financial accounting or economic development and village fund allocations Aligning ex isting models

No direct fiscal incentives for conserving natural capital for the long term

SLP Initiatives

Limited leveraging of donor funding and private sector investment

Establishing new models

Budget allocations and fiscal drivers

Payment for Ecosystem Services

Low Emission Enterprises

Incorporating natural capital considerations in budget allocations

Establishing models in which civil society and private sector pay for services

Demonstration of innovative low emission business models

• Establishing models in which communities and the private sector pay directly for natural capital benefits and ecosystem services • Incorporating jurisdictional approach to reducing deforestation and forest degradation, through holistic landscapes approach and PES financing models

• Demonstrating the benefits of innovative low emission business models, to encourage further update and investment • Developing Landscape Bond-based funding to be directed to low emission business models and enterprises across North Sumatra and West Papua

• Incorporating natural capital considerations in Government budget allocations and fiscal incentives • Developing Trust Funds and/or leveraging funding support from bilateral and multilateral sectoral programs

Outcomes • Concept notes for establishing fiscal incentives for forest conservation, through Regional Incentive Funds

• Scoping of PES model for improved watershed management for improved water quality in North Sumatra

• Trust Funds established to capture and allocate donor funding through budget allocations and fiscal incentives

• Concept notes and action plans for jurisdictional approaches to REDD+

• Efficient cook stoves program to reduce fuelwood for cooking • Eco-tourism and other alternative income streams for districts • Landscape Bonds directed to low emission business models

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CAS E S TUDY

LANDS CAPE ACCO UNTI NG F RAM EWO RK

LANDSCAPE ACCOUNTING SLP is well placed to assist national and sub-national implementation efforts to develop robust landscape accounting frameworks Measuring landscape sustainability

Online dashboard for North Sumatra

Monitoring landscape sustainability with quantifiable, commonly agreed upon key indicators enables informed decision-making and prioritization of investments

Online dashboard SLP’s online dashboard gives a holistic view of landscape sustainability encompassing natural capital, production and human well-being

Public data sets and indexes The LAF is based on a number of existing credible public data sets and indexes that ensure low-cost, regular and consistent monitoring

Aligned with UN Sustainable Development Goals The LAF key indicators are aligned with the SDGs for full alignment with global sustainability targets

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S LP F RAM EWO RK | GO V ERNANCE |

NATURAL CAPI TAL

| S US TAI NABLE PRO DUCTI O N

|S U S T A I N A B L E F I N A N C E

KEY MESSAGES 1. Integrated approaches are essential to sustainable development A range of challenges are prominent – forest loss, smoke haze and threats to biodiversity. Underlying drivers include increasing population pressures, competing demands for land use and limited recognition of ecosystem services. These challenges cannot be resolved in isolation.

2. A cross-sectoral landscapes approach is required

SLP advocates an integrated approach to addressing complex landscape challenges – and has facilitated a broad range of coordinated activity designed to support good governance, conserve natural capital and establish sustainable production.

3. Partnerships and collaboration are key SLP has established effective public-private partnerships that are driving sustainable development and low emission development models across provinces – from North Sumatra to West Papua.

4. Sustainable finance is a critical enabler SLP is pioneering new financing models that recognize the value of ecosystems services that are provided by natural capital.

Further work is required to implement practical and scalable models throughout Indonesia.

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