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93 6 CAN INDONESIA LEAD ON CLIMATE CHANGE? Frank Jotzo Indonesia’s environment matters not only to the quality of life of its people , but also to its neighbours and the world. Indonesia is among the world’s largest emitters of carbon dioxide, but it has good opportunities to reduce those emissions to the benefit of future generations every­ where. Better management of the environment could also have more tangible benefits, such as saving Indonesia’s neighbours from haze pollution , reducing flooding, increasing agricultural productivity and protecting Indonesia’s globally important reservoirs of biological diversity. There is a fundamental tension between the environment and development in Indonesia (Resosudarmo and Jotzo 2009). The country is exceptionally well endowed with natural resources, the exploitation of which accounts for a large share of economic activity. Conversion of natural forests to oil palm plantations brings jobs and infrastructure to backward areas. It also creates large profits for industry as well as substantial tax revenues. So does mining for minerals and coal, and the extraction of oil and gas. Meanwhile, growth in service and manufacturing industries together with rising household incomes mean ever-increasing demand for electricity and other forms of energy. Managing the environmental effects of economic development is a challenge for all countries. Sustainability entered mainstream global strategic thinking with the 1992 Rio Earth Summit and today finds its expression in the ambition for ‘green growth’. Climate change is the emblematic issue in the quest for green growth, as rapid global economic growth using the conventional, greenhouse gas-intensive model could result in dangerous changes to the world’s climate. The issue is not to slow development and economic growth but to achieve such growth in a manner that puts less stress on the environment. 94   Indonesia Rising: The Repositioning of Asia’s Third Giant Indonesia could play an important role in the global effort to put economies on a more environmentally sustainable footing. On climate change in particular, Indonesia might be able to take a leadership role among developing countries, because of its potential to change its trajectory in deforestation and energy supply, and because of its strategic position as a large, fast-growing developing country that tends to look for a middle way in international affairs. Indonesia has been a positive influence in international climate change negotiations, reflecting its desire to be a responsible and constructive player on the global stage. President Susilo Bambang Yudhoyono made a significant pledge to reign in Indonesia’s greenhouse gas emissions, choosing a G20 summit as the venue for his announcement. But pledges do not equal action. In Indonesia as in other democracies , substantive reform tends to meet resistance from entrenched interests . The owners of resources tend to oppose new laws that would force them to operate with more regard to the environment, even if it serves the overall national interest. As Chatib Basri points out in Chapter 3 of this volume, in the context of market reform, powerful vested interests can hold sway over the highest levels of politics. Local communities that rely on forest conversion generally see little benefit in contributing to a national or global ambition to reduce carbon emissions. Line ministries in the resource sectors tend to look after their industrial clients, and are often looked after by those industries in turn. This chapter is organized as follows. The next section discusses international climate change policy, and Indonesia’s role in it. This is followed by an examination of Indonesia’s greenhouse gas emissions profile and its emission reduction target. The chapter then looks at ways to meet that target before discussing political and institutional constraints. INDONESIA’S ROLE IN INTERNATIONAL CLIMATE CHANGE POLICY Climate change as a global strategic and policy issue Climate change has been a top-level item on the agendas of international forums and national governments, following a number of influential reports that pointed out its dangers and charted ways of addressing the challenge. Among the most influential were the 2007 report by the Intergovernmental Panel on Climate Change (IPCC 2007) and a review of the economics of climate change commissioned by the British government and led by Lord Nicholas Stern, a prominent economist who had formerly worked for the World Bank (Stern et al. 2006). Can Indonesia Lead on Climate Change?   95 The IPCC report summarized the increasingly firm insights from climate change science and helped establish the case for urgent government action to reduce greenhouse gas emissions. These findings were subsequently popularized by former US...


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