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NEWS UPDATES Asean Affairs                      17  August 2011

Carbon credit plan in Borneo falters

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In July 2010, US investor Todd Lemons and Russian energy giant Gazprom believed they were just weeks from winning final approval for a landmark forest preservation project in Indonesia.

A year later, the project is close to collapse, a casualty of Indonesian bureaucracy, opaque laws and a secretive palm oil company.

The Rimba Raya project, on the island of Borneo, is part of a United Nations-backed scheme designed to reward poorer nations that protect their carbon-rich jungles.

Deep peat in some of Indonesia's rainforests stores billions of tons of carbon so preserving those forests is regarded as crucial in the fight against climate change.

By putting a value on the carbon, the 90,000-hectare project would help prove that investors can turn a profit from the world's jungles in ways that do not involve cutting them down.

After three years of work, more than $2 million in development costs and what seemed like the green light from Jakarta, the project is proof that saving the world's tropical rainforests will be far more complicated than simply setting up a framework to allow market forces to function.

An investigation into the case also shows the forestry ministry is highly skeptical about a market for forest carbon credits, placing it at odds with President Susilo Bambang Yudhoyono, who supports pay-and-preserve investments to fight climate change.

Hong Kong-based Lemons, 47, a veteran of environmentally sustainable, and profitable, projects, discovered just how frustrating the ministry can be to projects such as his.

"Success was literally two months around the corner," he said. "We went through -- if there are 12 steps, we went through the first 11 on time over a 2-year period. We had some glitches, but by and large we went through the rather lengthy and complicated process in the time expected."

That's when the forestry ministry decided to slash the project's area in half, making it unviable, and handing a large chunk of forested deep peatland to a palm oil company for development.

The case is a stark reminder to Norway's government, the world's top donor to projects to protect tropical forests, on just how tough it will be to preserve Indonesia's rainforests under its $1 billion climate deal with Jakarta.

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This year in Thailand-what next?

AseanAffairs   04 January 2011
By David Swartzentruber      

It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

The first issue that can’t be answered is the health of Thailand’s beloved King Bhumibol, who is now 83 years old. He is the world's longest reigning monarch, but elaborate birthday celebrations in December failed to mask concern over his health. More


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