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POTENTIAL OF INDONESIAN SMALLHOLDER
AGROFORESTRY IN THE CDM: A CASE STUDY IN
THE UPPER CITANDUY WATERSHED AREA1
Kirsfianti Ginoga, Yuliana C. Wulan, Deden Djaenudin2
ABSTRACT
This paper explores the potential of smallholder agroforestry as an activity within the small-scale
project category of the Clean Development Mechanism (CDM) of the Kyoto Protocol. The paper
presents an overview of agroforestry in the Upper Citanduy Watershed. Existing patterns of
smallholder agroforestry are identified and their capacity to sequester carbon through biomass
accumulation is measured. The performance of the systems is evaluated in terms of financial and
economic measures. The paper concludes with a discussion of the eligibility of these projects and
identifies institutional issues in preparation for carbon trading.
Keywords: smallholder agroforestry, CDM, carbon sequestration .
INTRODUCTION
The Clean Development Mechanism (CDM) of the Kyoto Protocol defines small-
scale afforestation and reforestation (AR) project activities as those that are expected
to result in net anthropogenic greenhouse gas removals by sinks of less than 8
kilotonnes of CO2 per year and that are developed or implemented by low-income
communities and individuals as determined by the host Party (Decision-/CP.9, Annex,
Chapter A, paragraph 1, http://UNFCCC/CDM). If a small-scale AR project results in
net anthropogenic greenhouse gas removals by sinks greater than 8 kilotonnes of CO2
per year, the excess removal will not be eligible for the issuance of “certified emission
reductions” (CERs)3. Under the CDM, a forest is defined as a minimum area of land
of 0.05-1.0 ha, with minimum crown cover of 10-30 per cent, and minimum tree
height of 2-5 m at maturity.
AR activities are a priority of the Indonesian government, because there are millions
of hectares of Imperata grasslands and high rates of deforestation and land
degradation. However, the success of government programs has not been
encouraging. There are many factors contributing to this failure, among others: lack of
1 Working Paper CC12, 2004. ACIAR Project ASEM 2002/066,
http://www.une.edu.au/febl/Economics/carbon/
2 Center for Socio Economic Research on Forestry, Indonesia. The authors would like to express their
gratitude to Oscar Cacho for editorial assistance.
3 CERs are unit of carbon removals that has been approved under the Kyoto Protocol. There are two
types of CERs, i.e., temporary CER (tCER) and long-term CER (lCER). TCERs are issued in a
commitment period expire at the end of the subsequent commitment period. LCERs are secured until
the end of the crediting period and expire at the end of it unless carbon stocks decrease. Crediting
period shall begin at the start of the project and is either 20 years renewable twice (i.e., extendable to
40 or 60 years) or 30 years.
1
community participation and poorly defined property rights. In contrast to government
AR activities, smallholder Javanese farmers have practiced agroforestry4 for decades.
Although establishment of agroforestry is expensive in terms of labour and capital
inputs, which may discourage its widespread adoption, the fact that smallholders
actually practice it, means that it must be profitable and/or provide other benefits.
This paper aims to explore the potential of smallholder agroforestry as an activity
within the small-scale CDM project category. The paper also discusses institutional
issues that may promote smallholder agroforestry. The underlying motivation of this
research is to contribute to designing efficient smallholder agroforestry projects for
carbon trading. The analysis presented in this paper may contribute in formulating
policies to be considered by the Indonesian Government to respond to the CDM, in
particular for small scale AR endeavours. This study is based on the Citanduy
watershed, one of most critical watershed areas in Indonesia.
The paper starts by presenting an overview of smallholder agroforestry systems in the
research site, followed by an analysis of the patterns and capacity of smallholder
agroforestry for carbon sequestration purposes. In the third section the performance of
the systems is evaluated in terms of financial and economic measures. The fourth
section discusses the eligibility and institutional issues of smallholder agroforestry in
preparation for carbon trading. The paper concludes with a summary of findings for
policy formulation.
METHOD
Research Site
A field survey was conducted in two sub districts (kecamatan) of the Citanduy
watershed: Cisayong (in the Tasikmalaya District (kabupaten)) and Sadananya (in the
Ciamis District). Cisayong is situated in the Upper Citanduy sub-watershed while
Sadananya is in the Cimuntur sub-watershed. The Citanduy wastershed is described in
some detail by Dwiprabowo and Wulan (2003). These authors also explain the
strategic importance of the two districts sampled in this study. The research sites
represent areas that are considered socially and economically disadvantaged due to
high unemployment and low income.
Data Collection
Data on smallholder agroforestry characteristics, inputs, outputs, prices, and tree
biomass were collected through a field survey. Interviews with the land owners and
observation and measurement of their trees were conducted in sample of farms.
Systematic sampling was employed to obtain estimates of tree volume and biomass of
the various agroforestry systems. Sampling intensity, on an area basis, was between 6
% - 12 % of each farm. In each farm, three measurement plots of equal size
(approximately 10m × 10m) were selected. A sample of 20 farms was taken
consisting of 8 farms in Tasikmalaya and 12 farms in Ciamis.
4 A form of land-use systems and practices where woody perennials are deliberately integrated with
crops and/or animals on private land outside “forestry zone”.
2
Species identification and tree measurements (including stem and tree heights, and
tree diameter) were conducted in all measurement plots. Tree height was measured
with a Haga hypsometer and diameter was measured with a measuring tape. Tree age
was noted based on information from the farmer. Data on establishment costs were
collected by interviewing each farmer using a prepared questionnaire.
OVERVIEW OF UPPER CITANDUY SMALLHOLDER
AGROFORESTRY
A good diversity of tree species was found in both districts, 11 species were identified
in Tasikmalaya and 28 species were identified in Ciamis (Tables 1 and 2). This count
excludes negligible amounts of cassava, pineapple, banana and taro.
In Tasikmalaya, the main species planted was Paraserienthes falcataria (86.9 %)
followed by Agathis dammara (2.3 %) and Hibiscus sp. (2.3 %). P. falcataria was
chosen as a main tree in the area because of the land suitability and easier accessibility
to market. Most P. falcataria trees were harvested in year 6, when reaching an
average diameter of 20-25 cm. The average price received by farmers for wood was
about Rp 140,535/m3.
Table 1. Species diversity of Tasikmalaya smallholder agroforests
No Species Scientific name Products Tree age Percent of total
per plot per farm
1 Sengon Paraserianthes falcataria Wood 2-6 86.9 % 27.6%
2 Kidamar Agathis dammara Wood 5-10 2.3 % 10.3%
3 Tisuk Hibiscus sp. Wood 2-4 2.3 % 10.3%
4 Manglid Manglidtia glauca Wood 5 1.8 % 6.9%
5 Alpukat Persea Americana Fruit, wood 5-10 1.4 % 10.3%
6 Cengkeh Eugenia aromatica Fruit, wood 10 1.4 % 6.9%
7 Nangka Artocarpus heterophyllus Fruit, wood 7 1.4 % 6.9%
8 Mahoni Swietenia macrophyilla Wood 5 0.9 % 6.9%
9 Afrika Maeopsis eminii Wood 2 0.5 % 3.4%
10 Huru Dehasa caesia Wood 3 0.5 % 3.4%
11 Suren Toona surenii Leaf, wood 3 0.5 % 3.4%
Total 100.0 % 100.0%
The main tree planted in Ciamis was africa (Maeopsis eminii). About 26.4 per cent of
plots were planted with M. eminii, or about 10.9 per cent of farmers planted this
species as a main tree, followed by P. falcataria, which covered about 10 per cent.
Both tree species were harvested in year 5-6, at an average diameter of 20-25 cm. M.
eminii was a popular tree in the area due to its better growth compared to sengon.
Africa trees were sold for about Rp 66 670/m3.
Other trees planted in Ciamis includes kidamar (A. dammara), puspa (S. wallichii),
pinus (P. merkusii) and mahogani (S. macrophylla). These trees are planted for their
wood, for shelter and for soil protection. While fruit trees such as kemang (Mangifera
spp), durian (D. zibethinus), cengkeh (E. aromatica), alpukat (P. Americana), limus (M.
foetida), kelapa (C. nucifera) were planted mainly for their fruit. Most of these
products were sold, but the fruit of guava (P. guajava) and cempedak (A. interger) were
mainly used for home consumption.
3
Table 2. Species diversity of Ciamis smallholder agroforestry
No Species Scientific name Products Tree age Percent of total
(years) per plot per farm
1 Afrika Maeopsis eminii Wood 2-6 26.4% 10.9%
2 Sengon Paraserianthes falcataria Wood 2-6 26.1% 9.9%
3 Mahoni Swietenia macrophylla Wood 4-7 17.1% 6.9%
4 Cengkeh Eugenia aromatica Fruit, Wood 4-10 3.8% 5.9%
5 Tangkil Gnetum gnemon Fruit, Leaf, Wood 3-10 3.6% 6.9%
6 Puspa Schima wallichii Wood 6-15 3.4% 4.0%
7 Petai Parkia speciosa Fruit, Leaf, Wood 3-15 2.9% 6.9%
8 Tisuk Hibiscus sp. Wood 2-5 2.7% 4.0%
9 Kiteja Cinnamomum spp. Wood 4-12 2.5% 7.9%
10 Alpukat Persea Americana Fruit, Wood 2-4 1.1% 5.0%
11 Jengkol Phithecellobium jiringa Fruit, Wood 3-7 0.9% 4.0%
12 Kelapa Cocos nucifera Fruit, Leaf, Wood 15-25 0.9% 2.0%
13 Kidamar Agathis dammara Wood 3-10 0.9% 2.0%
14 Limus Mangifera foetida Fruit, Wood 2-25 0.9% 2.0%
15 Suren Toona surenii Wood 1-3 0.9% 2.0%
16 Johar Gliricidia sepium Wood 5 0.7% 1.0%
17 Kemang Mangifera spp. Fruit, Leaf, Wood 3 0.7% 1.0%
18 Picung Hibiscus sp. Wood 14 0.7% 3.0%
19 Putat Planchonia valida Wood 3-4 0.5% 2.0%
20 Durian Durio zibethinus Fruit, Wood 2-6 0.5% 1.0%
21 Jambu batu Psidium guajava Fruit, Wood 6 0.5% 1.0%
22 Cempedak Artocarpus interger Fruit, Wood 3 0.5% 2.0%
23 Huru Dehasa caesia Wood 3 0.5% 2.0%
24 Kinyere Syzigium spp. Wood 6 0.2% 1.0%
25 Pinus Pinus merkusii Wood 3 0.2% 1.0%
26 Pisitan Lansium sp. Fruit, Wood 6 0.2% 1.0%
27 Rambutan Nephellium lappaceum Fruit, Wood 4 0.2% 1.0%
28 Tangkalak Litsea spp. Fruit, Wood 2 0.2% 1.0%
The general profile of the smallholder agroforestry systems in Tasikmalaya and
Ciamis are shown in Figure 1. Consistent with the previous discussion, it can be seen
that smallholder agroforestry in Ciamis has more trees and a closer cover of canopy
than in Tasikmalaya.
On average tree height in Ciamis was between 7-31 m, while in Tasikmalaya was
between 8-25 meters. These values were well above the forest height minimum
definition of 2-5 m as agreed in COP 9.
Patterns of Agroforestry Systems
Not all smallholder agroforestry systems have the same potential. To evaluate various
systems from a C-sequestration perspective, agroforestry in both districts was grouped
into eight patterns, four patterns from Tasikmalaya and four patterns from Ciamis
(Table 2).
The patterns differ in terms of diversity of species, tree density and, implicitly,
management intensity. The age of most woody and fruit trees varied, ranging from 2
to 25 years.
4
(A) (B)
Figure 1. The General Profile of Smallholder agroforest in Tasikmalaya (A) and Ciamis (B)
5
Table 2. Pattern of Smallholder Agroforestry in Tasikmalaya and Ciamis
Pattern Tree Species No. trees/ha % of Sample
Tasikmalaya District
1 (T1) Sengon 65 25 %
2 (T2) Sengon, Mahoni, Manglid, Avocado, Kidamar 46 25 %
3 (T3) Sengon, Tisuk, Suren, Jackfruit, Parkia, Avocado 35 25 %
4 (T4) Sengon, Avocado, Kidamar, Tisuk, Cengkeh 22 25 %
Total 100 %
Ciamis District
1 (C1) Afrika, Mahoni, Sengon, Puspa, Tisuk, Tangkil, 173 42 %
Nangka, Cengkeh, Kiteja, Kidamar, Coconut,
Avocado, Parkia, Durian
2 (C2) Sengon, Afrika, Cengkeh, Mahoni, Parkia, Puspa, 155 25 %
Jackfruit, Tangkil, Johar, Limus, Tisuk, Kemang
3 (C3) Kiteja, Mahoni, Sengon 11 8%
4 (C4) Sengon, Mahoni, Afrika, Tangkil, Jackfruit, 99 25 %
Cengkeh, Kidamar
Total 100%
Carbon Sequestration Capacity
The amount of carbon sequestered by the eight smallholder agroforestry patterns in
Tasikmalaya and Ciamis were estimated using both Brown (1997) and Vademicum
(1976) models. Only above ground biomass (no soil) carbon was considered.
The Brown (1997) allometric model is: C = 0.45(0.11ρ × 2.62 D )
The Vademicum, (1976) model is:
D
Tree volume: V = 2π × 0 . 45 H . δ
2
4
Biomass: B = V ×ρ
3
Carbon: C = 0.45 B
Where C is carbon content, ρ is wood density, D is diameter, H is tree height, and δ
is wood correction factor (0.6 for sengon, africa and all fruit woody trees). The benefit
of using allometric biomass estimates is that it is relatively simple, its weakness is that
it ignores carbon content in soil and roots.
The carbon-sequestration capacity provided by each pattern is shown in Table 3. The
table shows the capacity of a hectare of smallholder agroforestry to sequester carbon.
6
Table 3. Biomass carbon stocks of smallholder agroforests
Biomass (t/ha) Carbon (t C/ha)
Pattern
Brown Vademicum Brown Vademicum
T1 55.89 71.63 25.15 32.23
T2 42.96 55.06 19.51 24.60
T3 56.22 72.06 25.30 32.43
T4 51.58 66.12 23.21 29.76
C1 113.96 137.95 48.68 67.65
C2 176.91 191.78 85.27 92.62
C3 110.59 141.73 49.76 63.78
C4 92.48 118.53 41.61 53.34
In terms of biomass carbon stocks, pattern C2 had the most carbon sequestered,
amounting to 85.27 tC/ha or 92.62 tC/ha using Brown and Vademicum models
respectively, followed by pattern C1 with between 48.68 tC/ha and 67.65 tC/ha. The
least amount of carbon occurred in pattern T2, with between 19.5 tC/ha and 24.6
tC/ha (Table 3).
It should be noted that species diversity is not reflected on the quantity of carbon
sequestered. The amount of carbon sequestered is also affected by factors such as
species, age and growth rate of trees.
The species sequestering most carbon are those categorized as woody trees which
produce wood only at the end of the cycle (Figure 2), such as puspa, kiteja and tisuk.
While fruit trees, which fix a smaller amount of carbon such as jackfruit, parkia and
cengkeh, were choosen by smallholders to maintain their livelihood needs. Sengon
and africa were chosen by smallholders in the study site partly because there are
markets for these trees. Although these woody trees sequester less carbon than other,
slower-growing, trees, the value of carbon does not enter the farmer’s decision. The
species composition of these agroforestry systems may change to longer-lived trees if
carbon payments are large enough to provide an incentive.
0.60
Afrika
0.50
Cengkeh
0.40 Kiteja
Mahoni
t C/tree
0.30
Sengon
0.20 Nangka
Tisuk
0.10
Tangkil
0.00
Puspa
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Petai
Age (year)
Figure 2. Carbon sequestration by species
7
Overall, in terms of carbon sequestration potential, smallholder agroforestry in the
study region is moderate compare to previous studies (Ginoga et al. 2002, Roshetko
et al., 2002), as seen in Table 4. This table shows that Citanduy smallholder
agroforestry systems had higher biomass-carbon stocks than rubber, cinnamon and oil
palm systems, but lower stocks than damar agroforestry.
Table 4. Carbon sequestration for selected agroforestry systems
Agroforestry System Average C sequestered
(t C/ha)
Rubber, traditionala 19.8
Rubber clonea 42.4
Cinnamon/potatoa 22.7
Damara 102.7
Oil palma 27.0
Tasikmalaya smallholder agroforestry 19.5 - 25.15
Ciamis smallholder agroforestry 41.6 - 85.3
a
Data from Ginoga et al. (2002)
Economic Performance
In this section, the economic performance of the smallholders agroforestry systems is
examined in financial and economic terms. Financial analysis is based on private
prices (prices actually experienced by producers), while economic analysis is based
on social prices (with the actual prices adjusted to eliminate market distortions). The
analysis undertaken follows the guidelines established by the Alternatives to Slash
and Burn (ASB) program (ICRAF, 1998; Budidarsono et al., 2001). The private
discount rate is set at 20% and the social rate at 15%. The planning horizon to
calculate net present values (NPV) is 25 years.
Costs of establishment consist of land preparation and planting activities. Annual
costs include maintenance, which normally occurs three times per year, and other
costs such as land rent and land tax. Selected inputs and outputs per hectare of
agroforestry are shown in the Appendix (Tables 8 and 9). Prices of inputs and outputs
are also presented in the Appendix (Table 10). It can be seen that cost for seedlings
occurs for the main trees (sengon or africa), while other woody and fruit seedlings are
not purchased but seeds are collected from the wild. Fertilizer and herbicide
application occurs during the first three years. The first three years are also
characterised by more intensive use of labour.
Most sengon and africa seedlings are locally produced, farmers normally have their
own nursery, but trading occurs when more or less seedlings than needed are available
in a farmer’s own nursery.
In financial terms, a system is feasible if its net present value (NPV) is positive. In
Tasikmalaya District, patterns 1 and 2 of produce negative NPV (Table 5), so they are
not feasible in the long term. These systems have lower species diversity and carbon
sequestration capacity, especially for pattern 1, which is a monoculture sengon. In
Tasikmalaya, pattern 3 produced the highest NPV as well as the highest carbon
sequestration capacity, although the number and diversity of trees were not the
highest.
8
Table 5. Economic performance of Tasikmalaya smallholder’s agroforestry
Pattern 1 Pattern 2 Pattern 3 Pattern 4
Social Analysis
NPV (Rp'000/ha) (1,742) (9) 17,446 16,848
IRR (%) 17.77 25.99 34.13 28.31
Establishment Cost (Rp'000/ha) 7,248 8,358 7,029 10,818
Years to positive cash flow na 6 8 10
Labour requirements:
Establishment (pd/ha) 719 3,635 1,456 3,882
Operation (pd/ha/yr) na 147 65 159
Total (pd/ha/yr) 144 146 66 162
Private Analysis
NPV (Rp'000/ha) (1,802) 1 10,294 10,610
IRR (%) 21.3 31.5 39.5 34.2
Establishment Cost (Rp'000/ha) 5,221 5,309 5,071 6,806
Years to positive cash flow na 6 8 10
Labour requirements:
Establishment (pd/ha) 719 3,635 1,456 3,882
Operation (pd/ha/yr) na 146 65 159
Total (pd/ha/yr) 144 146 66 162
Return to Labour 6,174 6,404 49,515 24,040
The overall NPVs and IRRs in Ciamis (Table 6) were lower than in Tasikmalaya
(Table 6), due to the lower price of the main output (africa wood). In general,
agroforestry systems dominated by sengon were more profitable than those dominated
by africa trees.
In Ciamis only pattern 1 produced a negative social NPV. The remaining systems all
had positive NPVs, so they are feasible. Patterns 2 and 4 are the most financially
attractive, with NPVs of over 6 million rupiah. Consistent with previous statements,
the systems with the highest NPVs also had the highest carbon stocks.
Establishment costs were estimated as the present value of annual costs until the
system reaches a positive cash flow. Overall the higher establishment costs accrue in
Tasikmalaya compared to Ciamis. This is partly due to higher price of seedlings and
tools and the higher quantity of labour used. In terms of employment potential all of
the systems provide similar prospects. In the case of establishment labour, smallholder
agroforestry in Tasikmalaya provide more employment.
Another interesting comparison can be obtained by evaluating the performance of
each system in terms of return to labour, as it provides a measure of the value of
labour applied to agroforestry. Higher returns to labour were obtained in Ciamis due
to the lower use of total labour.
9
Table 6. Economic performance of Ciamis smallholder’s agroforestry
Pattern 1 Pattern 2 Pattern 3 Pattern 4
Social Analysis
NPV (Rp'000/ha) (381) 13,741 236 11,611
IRR (%) 14.32 29.41 na 29.26
Establishment Cost (Rp'000/ha) 9,658 6,527 2,885 7,606
Years to positive cash flow Na 11 3 10
Labour requirements:
Establishment (pd/ha) 1,604 688 402 2,240
Operation (pd/ha/yr) Na 62 22 89
Total (pd/ha/yr) 64 62 22 89
Private Analysis
NPV (Rp'000/ha) (946) 6,414 81 6,563
IRR (%) 17.2 32 na 34
Establishment Cost (Rp'000/ha) 6,288 4,652 2,447 5,219
Years to positive cash flow Na 11 3 10
Labour requirements:
Establishment (pd/ha) 1,604 688 402 2,240
Operation (pd/ha/yr) Na 62 22 89
Total (pd/ha/yr) 64 62 22 89
Return to Labour 7,780 42,889 na 28,617
POLICY IMPLICATIONS
The flows of CO2 sequestered per year (Table 7) were calculated based on the stocks
of carbon measured in this study5 (Figure 2). Under the CDM, a reforestation project
does not qualify as small-scale if it sequesters more than 8,000 tonnes of CO2 per
year. Therefore, the maximum area eligible in the study area would be between 1,641
and 2,770 ha in Tasikmalaya, and between 565 ha and 1,283 ha in Ciamis (Table 7).
The average land holding in the area is about 0.53 ha, this means that the maximum
number of landholders that could participate in a single project would be about 3,096
to 5,226 people in Tasikmalaya, and between 1,066 and 2,421 in Ciamis. To put these
figures in perspective, to cover the whole area of the Upper Citanduy sub-watershed
(74,800 ha) would required between 27 and 132 small-scale agroforestry projects.
This may result in high transaction costs (Roshetko, et.al., 2002; Cacho, 2003). The
subsequent challenge is thus to develop bundling mechanisms to reduce these costs,
including taking into account the land-use patterns that would be adopted. It will also
be necessary to identify intermediaries for carbon trading and to decide how to share
costs and revenues of establishing the project.
5 One tonne of biomass C is equivalent to 3.67 tonnes of CO2 absorbed by trees.
10
Table 7. CO2 sequestered by agroforestry systems in Upper Citanduy and size of project (in terms of
area and number of farms) required to reach the maximum (8,000 tonnes) amount of CO2 to qualify as
a small-scale CDM project
CO2 sequestered Area of land in project Number of farms
(tones/ha) (ha)
Pattern Brown Vademicum Brown Vademicum Brown Vademicum
T1 3.43 4.4 2,332 1,820 4,400 3,434
T2 2.89 3.64 2,770 2,198 5,226 4,147
T3 3.8 4.88 2,103 1,641 3,968 3,096
T4 3.47 4.45 2,305 1,798 4,350 3,393
C1 7.44 10.34 1,075 773 2,028 1,459
C2 13.03 14.16 614 565 1,158 1,066
C3 7.36 9.44 1,086 848 2,050 1,599
C4 6.23 7.99 1,283 1,001 2,422 1,888
Another condition of small-scale CDM projects is that they must be implemented by
low-income communities and individuals, as determined by the host country. There
are several criteria to be categorized as being poor in Indonesia, such as having
income less than $1 per day or consume less than 2100 Kcal per day. Income per
capita in the study areas was about Rp 996,195 and Rp 1,245,739 respectively in
2001; this is lower than the averave income per capita of the West Java province (Rp
1,398,724) and is concsidered a low income in Indonesian society, therefore these
farmers should be eligible to participate in small scale AR CDM projects.
In terms of the additionality requirement, the fact that farmers have adopted these
systems already means that the systems are part of the baseline, and therefore not
additional to what would have occurred in the absence of a CDM project. However,
there may be barrier to more widespread adoption of these systems, such as lack of
technical skills or investment capital to eatblish the trees.
A successful CDM project requires clear policy guidelines as well as close
collaboration among the stakeholders involved. Project participants (smallholders and
investors), governments (local, provincial and national), and international CDM-
related organisations (executive board, expert panel, and operational entity) must
work together. As it is already mentioned, in order to obtain a comparative cost
advantage for smallholder projects, it must be ensured that cost imposts in the CDM
are minimised.
As can be seen in Figure 3, the relationship within Indonesia CDM structure and
stakeholders is very complex. There are three levels of government (national,
provincial, and district), and one international level to deal with. Law No. 22/1999
about autonomous government directs the Republic of Indonesia, as a united country,
to decentralize government administration by giving autonomy to its regions
(provincial and district administration). This law empowers the community to enhance
their own initiatives, improve capacity building and strengthen the role and function
of the Province, district and Council House of Representatives. The transition can be
characterised as a period of learning and development of new regulations and decrees
to implement and deliver change. The promulgation of this Law has a potential role
in shaping AR CDM implementation. Within each level of government, there are
several institutions (government and non government organisations) involved to assist
in the implementation of AR CDM activities. For example, within the provincial
level, institutions related to CDM include the provincial forestry office, provincial
11
development agency, environmental impact agency, and the provincial authorities
(including governor and House of Representatives). The role and function of these
agencies is not yet clear. The provincial level of government may also need to transfer
authority to the district level when the project is located within the boundary of one
single district. Therefore, many regulations will be required to implement this Law
across all levels of government and sectors.
Currently, the most operational guidelines referred to by stakeholders for AR CDM at
the provincial and local level is Government Regulation (Peraturan Pemerintah) No.
34/2002 (NSS, 2003; Murdiyarso, 2003; Ginoga, et al. 2004), regarding permits for
environmental services projects under forestland allocation, forest management
planning, forest and forest land use. This regulation applies to two of the four land
tenures identified by the Ministry of Forestry: protection forest and production forest;
yet AR CDM projects may be implemented in private or communal land, which is not
accommodate in this regulation. PP 34, also, does not provide procedures and steps
toward the implementation for AR CDM. It is also not clear where the boundaries of
authority are concerning taxes and levies as well as the responsibilities of each level
of government.
Despite the facts that a Designated National Authority (DNA), a national board to
verify and approve CDM projects, has already been established, the coordination
mechanism within the DNA is still debatable. Also, no operational entities who have
good communication with the international board for certification have been
identified. Therefore, the institutional structure to support the CDM in Indonesia is
considered underdeveloped, especially for small-scale agroforestry.
In summary, institutional preparation for CDM in Indonesia is far behind schedule.
Reasons for this include the complexity of the mechanism, no clear guidelines on
procedures, no single organization taking a leading role for bundling. In addition,
financial barriers remain unsolved. Therefore, the high potential of smallholder
agroforestry for CDM schemes remains in doubt.
Executive Board – 10 members
accredits Spot Check
Registers
Operational entity
Government: District, Operational entity
Provincial and National
Project Design Validation, can CDM Verification
Document: include new Project
Project Moni-
Baseline methodology
Participants toring CERs
monitoring
Report
Approval Certification
DNA
District Level Provincial Level National Level International Level
Figure 3. Institutional features of indonesia’s CDM (modified from, michaelowa, 2003)
12
REFERENCES
Dwiprabowo, H and Wulan, Y.C. (2003) A description of the Citanduy watershed,
west Java and preliminary analysis of carbon-sequestration potential by
smallholders. Working Paper CC09, ACIAR Project ASEM
1999/093.(http:/www.une.edu.au/febl/Econ/carbon/wpapers.htm)
Brown, S. 1997. Estimating Biomass and Biomass Change of Tropical Forest: a
Primer. FAO Forestry Paper-134. Food and Agriculture Organisation of
The United Nation, Rome.
Budidarsono, S, Arifatmi, B., de Foresta, H. and Tomich, T.P. 2001a. Damar
Agroforest Establishment and Sources of Livelihood: A Profitability
Assessment of Damar Agroforest System in Krui, Lampung, Sumatra,
Indonesia. 1-5.
Budidarsono, S., delos Angeles, M.S. and Wibawa, G. 2001b. A profitability
assessment of smallholder rubber agroforest systems in Jambi, Sumatra,
Indonesia. Manuscript prepared for the workshop “Complex Agroforests:
Farmers Knowledge, Management, Profitability and Conservation”, Muara
Bungo, Jambi, 3-6 September 2001.
Cacho, O. Graham Marshall, and Mary Milne. 2003. Smallholder agroforestry
projects: Potential for carbon sequestration and poverty alleviation. ESA
Working Paper 03-06. FAO.
Direktorat Jenderal Kehutanan. 1976. Vademicum Kehutanan. Jakarta.
Ginoga, K., Cacho, O., Erwidodo, Lugina, M., and Djaenudin, D. 2002. Economic
performance of common agroforestry systems in Southern Sumatra,
Indonesia:mplications for carbon sequestration services.Working Paper
CC03, ACIAR Project ASEM
1999/093.(http:/www.une.edu.au/febl/Econ/carbon/wpapers.htm)
Ginoga, K.L., Mega Lugina, Deden Djaenudin. 2004. Kajian Kebijakan MPB
Kehutanan di Indonesia (Policy analysis for CDM Forestry Deployment in
Indonesia). Jurnal Penelitian Sosial Ekonomi Kehutanan, No. 1, Vol. 1.
ICRAF, 1998. Alternatives to Slash and Burn in Indonesia. Summary Report and
Synthesis of Phase II. ASB Indonesia Report No. 8, Bogor. Indonesia.
Michaelowa, A. 2003. CDM Host Country Institution Building. Mitigation and
Adaptation Strategies for Global Change 8:201-220. Kluwer Academic Publisher.
Netherlands.
Ministry of Environment. 2003. National strategy study on CDM in Forestry Sector
Indonesia. Ministry of Environment, Jakarta.
Murdiyarso, D. 2003. CDM: Mekanisme Pembangunan Bersih. Penerbit Buku
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Roshetko, J.M.; Marian S. delos Angelos, and Katherine Warner. 2002. Smallholder
Agroforestry Systems as a Strategy for Carbon Storage. Paper Presented at
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November 11-15, 2002, Taipei. Taiwan.
13
APPENDIX
Table 8. Selected inputs and outputs for a hectare smallholder agroforestry in Tasikmalaya for the 25-
year planning horizon
Input/Output Pattern Pattern Pattern Pattern
1 2 3 4
Seedlings
Sengon 4,687 3,835 3,985 2,332
Ferlitisers
Urea (kg) 1,121 1,293 1,410 995
TSP (kg) 1,121 2,250 1,410 995
Labour
Hired (pd) 2,250 2,250 766 2,250
Family (pd) 1,180 1,385 884 1,791
Outputs
Sengon (m3) 903 769 799 439
14
Table 9. Selected inputs and outputs for a hectare agroforestry in Ciamis for the 25-year planning
horizon
Input/Output Pattern Pattern Pattern Pattern
1 2 3 4
Seedlings
Sengon 133 3,060 3,000 800
Afrika 1,652 1,664 1,413
Ferlitiser
Urea (kg) 1,360 - 4,899 -
TSP (kg) 2,400 - - -
Manure (kg) 39,010 46,460 - 57,600
Labour
Hired (pd) 920 949 555 1,300
Family (pd) 684 603 - 940
Outputs
Sengon (m3) 33 642 1,746 268
Afrika (m3) 894 890 - 433
15
Table 10. Input and output prices of smallholder agroforesty
Price (Rp/unit)
Input/Output
Tasikmalaya Ciamis
Seedling
P. falcataria per seed 481 200
Maeopsis eminii per seed - 200
Labour
Labour, Family (pd/d) 8,500 8,700
Labor, Hired (pd/d) 8,500 8,700
Fertilizer
Urea (N) (kg) 1,500 1,500
TSP (P) (kg) 1,800 1,800
Manure (kg) - 58
Herbicides (ltr) - 25,000
Tools
Hoe (unit) 80,000 80,000
Sickle (unit) 25,625 25,000
Output
Sengon (m3) 140,535 66,667
Africa ( m3) - 66,667
Tangkil ( kg) 1,700 1,700
Cengkeh (kg,dry) 25,000 -
Alpukat (kg) 2,000 2,000
Petai (fruit/tree) - 250,000
Kelapa (fruit) - 450
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