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Jakarta Post

Strengthening environmental safeguards

  • Peter Oksen and Taswin Munier

    The Jakarta Post

Jakarta   /   Thu, December 11, 2014   /  10:09 am

Protecting the environment starts with policymaking as well as the development and design of projects. Environmental safeguarding tools can minimize hidden environmental costs and should be brought to the forefront of the environmental agenda by the new Environment and Forestry Ministry.

Most previous plans and projects in Indonesia have resulted in the accelerated degradation of natural resources. This will eventually create costs. Those who will have to bear the costs are the affected locals, the state and hence its tax payers. From an international point of view, the resulting loss of unique biodiversity and climate change impacts are of very high concern.

Environmental costs are often hidden costs as they are not well known and not included in the economic calculations used for evaluating the profitability of a project.

This could be costs associated with loss of habitat and the pollution of rivers, soil, the sea and air. The pollution could, for example, result in fewer catches of fish or the poisoning of people living off polluted land and breathing polluted air.

Usually, no budget is set to mitigate the costs as such costs are often referred to as externalized costs.

However, internationally, and also in Indonesia, increasing attention is being placed on externalized costs.

Methods and policies are developed to include these costs and concerns in the planning and permit-acquisition process. Green banking, triple bottom line, full-cost accounting, ecoBudget, extended cost-benefit analyses and many other tools and methods have been developed, often used voluntarily by large companies as part of their Corporate Social Responsibility (CSR) strategies.

And then there are the officially required Strategic Environmental Assessment (SEA/KLHS) and Environmental Impact Assessment (EIA/AMDAL).

These two tools are presently the only commonly used environmental safeguarding tools in Indonesia.

As such, their effective implementation is critical for maintaining the biodiversity and environmental quality of Indonesia.

The SEA/KLHS is used to evaluate the environmental impacts of plans and policies. According to the Environmental Law, all major plans shall have a SEA made as part of the planning process, that is, not after the plan is finalized.

In the SEA, all impacts, including bio-physical, chemical, social, economic, health, and cultural, are assessed in a systematic way.

The focus is on strategic issues, that is, issues that cut across boundaries, population groups, regions, areas, and projects. Ideally, the externalized costs of a plan and policy should be calculated to give an idea of what hidden costs may be present.

If done well, a SEA will act as a policy dialogue tool for planners and policy makers, to engage the public and experts in making a plan or policy that is as green as possible. Recently, a major SEA has been completed on the Master Plan for the Acceleration and Expansion of Indonesian Economic Development (MP3EI).

The EIA/AMDAL is similar to SEA, only it is assessing a specific project rather than a plan. However, the EIA is also part of the permit-acquisition process and must be approved before a project can be implemented.

Both SEA and EIA were anchored in the former environment ministry, while the actual assessments are made by the plan, policy, and project owners who often hire specialized consultants to write them.

In the case of SEA, its development as an efficient policy dialogue tool has been slowed down by a lack of clear government regulations, which has resulted in six ministries having their own guidelines.

It is therefore difficult to apply a coherent approach to SEA'€™s and there is a need for a central agency to provide technical guidance and quality assurance.

With the merging of the environment and forestry ministries, there is a golden opportunity to take up and reinforce this important role. The Danish government and the Danish International Development Agency (Danida) support the development of SEA and EIA through the Environmental Support Program.

The new ministry should take the lead in ensuring efficient and focused SEA'€™s and EIA'€™s of high technical quality.

This could have an enormous positive impact on both the environment and forests in Indonesia.


Peter Oksen is national program advisor and Taswin Munier is the national program administrator at the Danish International Development Agency (Danida) Environmental Support Program. The views are personal.

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