KUALA LUMPUR (THOMSON REUTERS FOUNDATION) - Indonesia should make permanent its temporary ban on new permits for oil palm plantations to advance progress on tackling deforestation and meet its climate goals, environmentalists say.

Home to the world's third-largest tropical forests and also its biggest palm oil producer, Indonesia introduced a three-year freeze on plantation permits that expires in September.

The moratorium sought to prevent forest fires, deforestation and land conflicts, help meet emissions reduction targets set under the Paris climate accord, boost oversight and accelerate efforts to increase yields among smaller palm oil producers.

Mr Yuyun Harmono, climate justice campaign manager at the Indonesian Forum for the Environment, said a three-year ban was not long enough to achieve those goals.

"They (government) have to extend it for longer as we still have the same problems," he told the Thomson Reuters Foundation. "Our main goal would be to have a permanent moratorium."

In 2019, Indonesian President Joko Widodo issued a separate permanent moratorium on new forest clearance for activities such as palm plantations or logging, covering about 66 million hectares of primary forest and peatland.

Last year, tropical forest losses around the world equalled the size of the Netherlands, according to satellite monitoring service Global Forest Watch (GFW), despite improved protection in parts of South-East Asia.

Conservationists blame production of commodities, including palm oil - used in everything from margarine to soap and fuel - and minerals, for much of the destruction of forests as they are cleared for plantations, ranches, farms and mines.

Destroying rainforests has major implications for global goals to curb climate change as trees absorb about a third of the planet-warming emissions produced worldwide, but release carbon back into the air when they rot or are burned.

"The palm oil moratorium was introduced in response to the catastrophic forest fires that occurred in Indonesia's forests and peatlands in 2015," said Ms Gemma Tillack, forest policy director at US-based non-profit Rainforest Action Network.

"Permanent moratoria would be welcomed and, if enforced, would make a massive contribution to the Indonesian government's efforts to reduce greenhouse gas emissions," she added.

Declining forest loss

Ahead of November's COP26 United Nations climate talks, Indonesia last month submitted an updated national climate action plan.

Government ministers said the country was optimistic of reaching a net-zero emissions goal by 2060 or sooner - at least a decade earlier than its previous 2070 target, Mr Widodo noted in March.

To meet this pledge, limiting forest destruction and conversion of land will be key, said green groups.

"The (Paris) agreement recognised the important role that avoiding deforestation and forest degradation would play in limiting temperature rises to 1.5 deg (Celsius)," said Ms Tillack.

GFW's 2020 deforestation data showed that Indonesia's primary forest loss decreased to just over 270,000ha - a fourth straight year of declines.

The downward trend has been due to a series of government policies, including the freeze on permits for palm oil plantations, said forestry experts.

Noting this success, Norway agreed in 2019 to make the first payment for reduced emissions under a US$1 billion (S$1.35 billion) deal with Indonesia to help protect its tropical forests.

"These (palm oil and forest) moratoria have contributed to reduced deforestation in Indonesia, both in terms of greenhouse gas emissions and forest converted and degraded," said Mr Johan Kieft, a green economy adviser for the UN Environment Programme.

Indonesia's Environment and Forestry Ministry did not respond to requests for comment.

First step

Despite the fall in Indonesia's deforestation rates, a lack of available data on plantation permits makes it difficult to attribute the trend directly to the palm plantation moratorium, said Mr Aditya Bayunanda, a director at green group WWF Indonesia.

The rate of expansion of oil palm plantations was already in decline in 2018, when the freeze was introduced, due to the weak price of the edible vegetable oil, forestry experts said.

However, the benefits of the policy to date have included the release of government data on palm plantations in state-owned forest estates, efforts to improve productivity among smallholders, better law enforcement against illegal plantations and reviews of existing permits, said Mr Bayunanda.

"We believe that the moratorium has been an important first step and that it should continue to give time until the initial purposes of the decree are met," he said.

In Malaysia, the world's second-largest palm oil producer, a cap on its oil palm plantation area had ensured higher yields than in neighbouring Indonesia, said lecturer Helena Varkkey of the University of Malaya in Kuala Lumpur.

The best course for Indonesia now is to extend the palm oil moratorium and double down on implementation of the policy, said Mr Andika Putraditama, forests and commodities manager at the World Resources Institute Indonesia, a think-tank.

That would include enforcing a mandate given to local governments to revoke licences not aligned with Indonesia's regulation and sustainable development goals, he added.

But with the South-East Asian nation overwhelmed in recent months by a rapid spike in coronavirus cases, the authorities may yet turn to the palm oil industry to lead an economic recovery, environmentalists warned.

A job creation Bill passed by the Indonesian Parliament late last year and an ambitious biodiesel push could also hinder any extension of the palm plantation moratorium, they added.

"Without an extension, the previously unbridled issuance of palm oil licences will resume, which would put even greater pressure on natural forests," warned project officer Angus MacInnes of the British-based Forest Peoples Programme.