How local elites earn money from burning land in Indonesia

Slash and burn is big business in the country, with burnt land commanding a higher price tag than land cleared through mechanical means because it is immediately ready for planting.

A “fire economy” has emerged in Indonesia in which the blazes tearing through the country’s land and forests, driven largely by the global demand for palm oil, are lining the pockets of local elites and their patronage networks, according to a new study.

Fire economy and actor network of forest and land fires in Indonesia,” published in the journal Forest Policy and Economics, details the ways in which a variety of people “benefit directly and indirectly from the business of fire, enjoying profits and economic rents at the expense of environmental quality.”

The study — carried out by scientists from the Center for International Forestry Research (CIFOR), the University of Riau and Bogor Agricultural University — focuses on four districts in Riau province, on Indonesia’s main western island of Sumatra.

The province reportedly experiences the most frequent fires in Indonesia, due largely to the massive conversion of forests and peatlands to oil palm estates, where slash-and-burn methods are employed to clear land for planting. The practice is illegal in almost all cases.

The fires do not only impact the local environment, with blazes in Indonesia regularly resulting in haze that affects the whole region, particularly Malaysia and Singapore, and that has been linked to a slew of premature deaths.

At the heart of the issue are the “enormous benefits” reaped by those involved in the fires, said one of the study’s authors, Herry Purnomo.

According to the report, land cleared by fire carries a higher price tag than that cleared through cut-and-slash techniques, as it is ready for immediate planting, saving the buyer from any land preparation.

They have their own capital and [are] supported by connected investors at a local, national or even regional level to organise people to illegally claim, burn and grow oil palm, for instance.

Herry Purnomo, co-author, Fire economy and actor network of forest and land fires in Indonesia

The trade of burned land is known locally as terima abu, or receiving the ashes, which fertilise the soil. 

The trading value of such land is $856 per hectare, compared to $665 per hectare for cut-and-slashed land, the report notes. Land already burned and planted with oil palm is even more lucrative, with a reported value of $3,800 per hectare.

“Buyers came from various levels: colleagues and family members, resident immigrants, company staff, village officials, business people and residents from nearby district towns,” the study says. “Networks also involved buyers from other islands, for example, medium-scale investors from Jakarta, Bogor or Surabaya.”

Based on data collected from 10 research sites and interviews with 131 respondents, including farmers, local officials, and plantation company employees, the study found that a number of actors benefited from the fires, but none more so than local elites, such as members of political parties and public figures.

Most of the locations studied had previously been linked to illegal logging. As a result, loggers had identified so-called “open access areas” that were not subject to land claims or were former concessions that had been abandoned.

Subsequent successful land claims in these areas were followed by fires, caused by slash-and-burn practices, and the establishment of oil palm and pulpwood plantations.

District-level elites, referred to as “farmer group organisers,” play a key role in managing such land transactions, and organising farmers and other community members who engage in burning, according to the report.

“They have their own capital and [are] supported by connected investors at a local, national or even regional level to organise people to illegally claim, burn and grow oil palm, for instance,” said Purnomo.

The study found that these farmer group organisers received the majority of revenue from burned land.

Individuals organised to slash and burn the land and village elites who administer land documents were among those also found to receive a cut of the revenue.

According to the study, efforts to stop fires are hindered by “complex social networks” formed by those profiting from the destruction, which can influence national and regional decisionmaking processes.

“The networks provide power, support, protection and access to various resources,” the study notes.

The large profits and increasing demand for palm oil — an ingredient estimated to be found in some 50 per cent of packaged products sold in supermarkets worldwide — incentivise the use of fire, while the patronage networks protect those involved.  

For the fires to stop, the study says, farmer group organisers need to be disempowered through law and policy.

Methods of achieving this disempowerment include stronger law enforcement on illegal land claims and transactions, cutting the flow of money coming from investors, and allocating land to small-scale farmers so they are not as dependent on the local elites, Purnomo said.

Ultimately, “to reduce fires we have to provide economic incentive and disincentive” for those involved to stop, he told Mongabay.

According to the report, government efforts to tackle the fires have to date largely failed to address the underlying causes of the issue, with actions focusing on things like canal blocking and an early warning system rather than measures such as providing financial incentives for land preparation without burning.

The UN’s REDD+ program, which focuses on reducing emissions from deforestation and forest degradation, has included efforts to incentivise communities to protect land from fires.

Among its other activities in Riau, REDD+ has “supported livelihood programs, community fire brigades, social forestry, as well as strengthening…law enforcement and training citizen journalists to cover forest issues,” Christophe Bahuet, Indonesia country director of the UN Development Programme (UNDP), told Mongabay.

However, Bahuet acknowledged that “challenges remain in ensuring corporate compliance and law enforcement,” with efforts being made by the body to promote justice sector reforms.

The study claims that as long as fires create more economic value than initiatives like REDD+, “actors will not feel incentivised to overcome or tackle fires.”

But, Purnomo said, policymakers in Indonesia are moving towards addressing such issues with the “Grand Design for Fire Prevention 2017-2019” agenda currently being coordinated by various ministries and agencies.

The new agenda includes strategies on providing economic incentives and disincentives for those currently profiting from the fires and on strengthening law enforcement, he explained.

Key to reducing the fires, he said, is an awareness at policy level that fires are ignited predominantly not because of climatic conditions but because of people seeking economic benefits.

“Transparency, civil society engagement, anti-corruption measures and an efficient government bureaucracy will reduce the effectiveness of patronage networks” established by those behind the fires, the study says.

Amid warnings of more fires in Riau, with an increasing number of hotspots detected across the province earlier this month, the report notes that without the effective implementation of such policies, the issue will only persist.

This story was published with permission from Mongabay.com

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