INTRODUCTION Forest Certification in Indonesia

Symposium, June 10-11, 2004 Indonesia DRAFT PAPER – DO NOT CITE 3

I. INTRODUCTION

Although it is often viewed as exclusively a market-driven tool for sustainable forest management, forest certification is actually much more: certification encourages collaboration, facilitates conflict resolution, builds confidence and trust, promotes partnership, and--of course—promises a premium price. These elements of a vision are a challenge for both private and communal forest managers. Certification, at least currently, may be a tool for breaking the impasse in forest management and moving gradually toward sustainable forest management for industrial and community forestry. The implementation of certification in Indonesia has many unique features. Many stakeholders questioned its effectiveness when the notion was introduced into the forestry arena in the 1990s. Not many parties welcomed the certification idea. However, international pressures including boycotts of Indonesian wood products in Europe and the US pushed forest certification onto the national forestry agenda. Those who believed in the potential of certification to encourage better forest management established Kelompok Kerja Sertifikasi Lembaga Ekolabel Indonesia Certification Working Group of Indonesia Ecolabel Institute. The initial goal of the Working Group was to develop a forest standard adapted to the Indonesian context. The Working Group officially became the Foundation of Lembaga Ekolabel Indonesia in 1998. Certification has been underway in Indonesia for about 10 years. Challenges to its success include a difficult external environment that includes inconsistent government policy, poor law enforcement, and corruption. In this context, detractors conclude that certification cannot work in Indonesia unless there is fundamental change in existing arrangements, in particular land tenure arrangements and the policy environment.. Conversely, those who promote certification argue that at the localpracticalunit management level there are companies who are struggling to improve their performance and who are making progress. Since 1998, 14 forest management units FMU have undergone a certification assessment out of a possible 300. Of the 14, one passed the LEI and FSC scheme with total area of 90,957 ha; four passed the expert panel II of LEI scheme total area of 665,046 ha; two had a lower performance total area of 557,173 ha; three passed only the screening process total area of 493,900 ha; and four failed altogether total area of 720,651 ha. Those with experience in certification recognize its influence on technical forestry practices. To date, in Indonesia, certification has pointed the way toward better forestry practices. Its economic and policy benefits are, however, considered to be much less insignificant. Symposium, June 10-11, 2004 Indonesia DRAFT PAPER – DO NOT CITE 4

II. BACKGROUND FACTORS