Graft in resources sector could ‘hurt’ climate initiatives

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Indonesia has been working to reduce deforestation in the remaining tracts of tropical rainforest. AFP

Long-standing corruption in Indonesia’s natural resources sector could worsen the climate crisis and hurt the country’s efforts in mitigating it and adapting to the ensuing changes, an anti-corruption activist has said.

Indonesia Corruption Watch (ICW) researcher Egi Primayogha said widespread corruption in the uncontrolled exploitation of natural resources could lead to greater use of dirty energy through burning coal as well as greater environmental damage, such as deforestation.

He said at a discussion on Tuesday: “This will hamper our transition to renewable energy sources.”

Indonesia has been working to reduce deforestation in the remaining tracts of tropical rainforest.

Tropical rainforests are important natural “lungs” that adsorb and store carbon and other greenhouse gases that are responsible for the planet’s increasing temperature.

The country is also moving toward the increased use of renewable energies and phasing out fossil fuels.

Egi added that natural resource management in the country was still prone to graft in many areas, in particular licensing, spatial planning and monitoring corporate adherence to environmental regulations.

He highlighted that bribery was still rampant in licensing, with companies bribing regional leaders with the authority to issue business permits for natural resource exploration and exploitation.

Supian Hadi, the regent of East Kotawaringin in Central Kalimantan, was named as a corruption suspect early last year for alleged abuse of power in issuing business licences to three mining companies in 2010-2012.

The Corruption Eradication Commission (KPK) estimated that the bribery case had caused state losses of more than 5.8 trillion rupiah ($396 million) in revenue from bauxite production, as well as from the environmental damage caused by mining activities.

Graft has also marred spatial planning in natural resource management, with companies bribing officials to illicitly convert forests into mines or plantations.

For example, the KPK prosecuted former Riau governor Annas Maamun for accepting over 1.5 billion rupiah in bribes from companies that converted forest areas in three regencies into oil palm plantations.

Annas was sentenced to seven years in prison in 2015 but was granted clemency by President Joko “Jokowi” Widodo in November. The graft reportedly caused five billion rupiah in state losses.

Egi added that corruption had also contributed to the poor monitoring of businesses’ environmental responsibilities, such as mine reclamation, as well as losses to the state from unpaid taxes, royalties and other tariffs.

Mining companies are mandated under a 2010 government regulation on mine reclamation to submit their environmental restoration plan when they apply for the mining permit.

The latest research by the Mining Advocacy Network (Jatam) shows that at least 3,092 open-pit mines had not been reclaimed as of April. Jatam also estimated that at least 143 people, mostly children, had been killed in accidents linked to mining pits.

Egi said: “There is a problem with weak supervision due to the lack of will among law enforcers and officials in [conducting] surveillance. We suspect collusion between mining companies and officials.”

The recent political move by the House of Representative in passing the revised Mining Law had also benefited mining companies, he said.

Egi pointed to Article 169A of the revised law, which he said allowed miners to resume operations at their mining concessions under a special mining permit (IUPK) instead of a contract of work.

The revision would also allow seven coal miners that are subsidiaries of large conglomerates to extend their mining contracts, meaning that coal production would continue despite the country’s target to achieve a 23 per cent renewable energy mix by 2025.

KPK deputy chair Lili Pintauli Siregar asserted the anti-graft body’s commitment in eradicating corruption in the natural resources sector through its National Movement to Save Natural Resources (GNP-SDA), which had been producing research-based policy recommendations since it launched the initiative in 2009.