EAST INDONESIA INVESTMENT DIALOGUE VOL. 001

PORTFOLIO YURISDIKSI KOMODITAS KAKAO & BAMBU UNTUK EKONOMI TANGGUH BENCANA

RINGKASAN EKSEKUTIF

Indonesia merupakan salah satu negara yang rentan terhadap dampak perubahan iklim, yang kemudian diperparah dengan adanya pandemi Covid-19. Oleh karena itu diperlukan sebuah skema ekonomi tangguh bencana salah satunya melalui diversifikasi ekonomi. Perekonomian Bali yang mengandalkan sektor pariwisata sangat terdampak saat Pandemi Covid-19 terjadi. Peluncuran Smesco Hub Timur pada tanggal 1 Oktober 2022 dan berbasis di Bali hadir untuk menjawab dua permasalahan yaitu mendorong diversifikasi ekonomi Bali dan memperkuat Kabupaten di wilayah timur secara khusus dalam penguatan dan pengembangan produk UMKM. Smesco Hub Timur ini akan berperan sebagai sebuah investment hub yang dilengkapi dengan SME’s Investment Dashboard untuk menghubungkan UMKM dan investor.

Kabupaten Sigi yang terletak di Sulawesi Tengah merupakan salah satu kabupaten di wilayah Timur Indonesia yang memiliki potensi pengembangan komoditas kakao dan bambu. Kakao merupakan salah satu komoditas ekspor unggulan Indonesia berasal dari Kabupaten Sigi, Sulawesi, yang juga tercatat sebagai produsen kakao terbesar di Indonesia dengan produktivitas tertinggi yaitu 20% atau 19.224,4 ton dari total produksi kakao di Sulawesi Tengah dengan penggunaan lahan terluas yaitu 27.705 ha. Namun demikian, prestasi biji kakao Sigi masih terkendala dengan kualitas bijinya yang rendah karena kurangnya proses fermentasi.

Menurut perwakilan aliansi cocoa di Indonesia, Cocoa Sustainability Partnership (CSP), sektor kakao Indonesia menghadapi persoalan produktivitas yang rendah. Padahal sektor kakao berpeluang menciptakan peningkatan pendapatan petani kakao hingga 8 triliun rupiah per tahun dengan catatan terjadi peningkatan produktivitas. CSP merupakan salah satu mitra pembangunan yang aktif mendorong pengembangan sektor kakao yang berkelanjutan di Kabupaten Sigi. Selain CSP, mitra pembangunan lain seperti LTKL dan PISAgro juga mendukung pengembangan sektor kakao Kabupaten Sigi.

Pada bulan Mei 2021, Pemerintah Sigi, CSP, LTKL, dan PISAgro telah menandatangani Nota Kesepahaman mengenai pembangunan industri kakao berkelanjutan di Sigi. Komoditas bambu saat ini juga tengah dikembangkan oleh Sigi yang berkolaborasi dengan Yayasan Bambu Lestari melalui pengembangan Desa Wanatani Bambu dan Bronjong Bambu sebagai upaya mitigasi bencana, khususnya banjir yang beberapa kali melanda Sigi.Melalui dialog Investasi Indonesia Timur ini, Kabupaten Sigi mengundang para mitra pembangunan dan investor untuk mengembangkan potensi komoditas kakao dan bambu. Dengan dukungan para mitra, harapannya dapat menciptakan kakao Sigi yang unggul dan bernilai jual tinggi yaitu organik dan ramah lingkungan.

PERJALANAN AGENDA TUJUAN PEMBANGUNAN BERKELANJUTAN (TPB/SDGS) DI INDONESIA

RINGKASAN EKSEKUTIF

Pemerintah Indonesia berkomitmen penuh untuk mencapai Tujuan Pembangunan Berkelanjutan (TPB/SDGs) pada tahun 2030. Kerangka pelaksanaan TPB/SDGs kemudian dituangkan dalam Peraturan Presiden No. 59/2017 dan diintegrasikan ke dalam RPJMN 2020-2024. Bappenas sebagai koordinator pelaksanaan TPB/SDGs memegang mandat untuk menyusun dan menetapkan Peta Jalan TPB/SDGs dan Rencana Aksi Nasional (RAN) TPB/SDGs yang berfungsi sebagai acuan bagi seluruh pemangku kepentingan dalam penyusunan perencanaan, pelaksanaan, pemantauan dan evaluasi TPB/SDGs.
Pandemi Covid-19 menjadi momentum bagi Pemerintah Indonesia untuk merestrategi visi Pembangunan Rendah Karbon dan Ketahanan Iklim yang bertumpu pada Tujuan/Gol 13 (Perubahan Iklim), sekaligus menjadi basis utama untuk mendukung tiga pilar pembangunan berkelanjutan yaitu Ekonomi, Sosial, dan Lingkungan. Pelokalan Agenda TPB/SDGs di tingkat subnasional dilakukan melalui penyusunan Rencana Aksi Daerah (RAD) yang saat ini sudah dilakukan di 31 Provinsi di Indonesia.

Pencapaian target ambisius TPB/SDGs hanya dapat dicapai melalui kemitraan multipihak yaitu pemerintah pusat, pemerintah daerah, pelaku usaha, CSO, akademisi, filantropi, dan pemangku kepentingan lainnya.

Dengan potensi filantropi yang besar di Indonesia, Perhimpunan Filantropi Indonesia hadir untuk memajukan dan memperkuat ekosistem filantropi di Indonesia untuk mencapai keadilan sosial dan pembangunan berkelanjutan. Kemudian terdapat IBCSD, yang saat ini sedang menginisiasi GRASP 2030 (Gotong Royong Atasi Susut & Limbah Pangan di 2030) guna menuju produksi dan konsumsi pangan yang lebih berkelanjutan. Di tingkat subnasional, Provinsi Riau merupakan salah satu provinsi pilot untuk menerapkan pertumbuhan rendah karbon yang hasilnya akan berkontribusi terhadap pencapaian TPB/SGDs.

Jurisdictions Financing is a critical instrument for advancing the balancing needs attainment between economic growth and conservation. JCAF #9 and JCAF #10 demonstrate financing opportunities nationwide for jurisdictions to benefit in pursuing Green Growth Vision. 

Jurisdictions continue progressing to realize the advancement of SDG’s Agenda. JCAF #7 zoomed in on Siak’s endeavors to demonstrate best practices through jurisdiction leadership, and JCAF #8 shared how philanthropists and jurisdiction leaders strategized efforts to advance the national Agenda. 

Key Messages

• Mangrove ecosystems are valuable economically and ecologically, providing a vast array of ecosystem goods and services to sustain livelihoods of coastal populations, maintain the very resources of the fishery industry and protect cities and infrastructure from ocean swell and extreme weather events.
• Mangroves also regulate coastal nutrient exchange, and are highly productive and efficient carbon sinks, comprising what is referred to as “blue carbon,” which has very significant value for climate mitigation.
• Mangroves are threatened by deforestation, degradation and unsustainable use driven by lack of understanding and awareness to properly internalize mangrove’s ecosystem service in their decision making.
• Considering the multiple values of mangroves, businesses’ participation in their restoration has high value for ESG proposition beyond CSR. The future carbon market regulation provides opportunities for first movers to gain benefits from the high-quality blue carbon credit from the restoration.
• KADIN and Filantropi Indonesia encourages their members to participate in the development of strategy and on the implementation of restoration activities, as well as the development of the carbon economy to incentivize and attract private sector’s and philanthropies’ participation to build up case studies and lessons learned for effective and sustainable mangrove restoration program.

The main objective of publishing this Siak, Riau, Jurisdictional Investment Outlook 2022 is to promote and to provide information on investment opportunities in all forms in the District of Siak, Riau, that will support the comprehensive and integrated jurisdictional approach in sustainably developing Siak.

Siak is launching itself to become a green district. To achieve this, in a participatory multi-stakeholder manner, we have formulated the Siak Green District Roadmap. To facilitate its implementation, we have enacted key legal instruments, namely the Head of District Regulation No. 22/2018 followed by District Regulation No. 4/2022 on Green Siak.

A Jurisdictional Approach is one that spatially harmonizes production of commodities, upstreaming of commodity and other sectors, as well as conservation so that development in the area can be carried out without degrading natural resources and the environment and is supported by sufficiently protected ecosystem services.

This harmonization is also carried out by all stakeholders collaboratively. In this matter, Siak prides itself as being facilitative to the multi-stakeholder collaborative processes in its development planning, implementation, and monitoring. The District of Siak is a very active and leading member of the Sustainable District Forum (Lingkar Temu Kabupaten Lestari, LTKL). The Government of the District of Siak also benefits from the productive engagement of the civil society through the “Sedagho Siak” mechanism, a participatory multi-stakeholder consultation approach.

This Outlook includes a list of investable jurisdictional initiatives that have been curated collaboratively among the stakeholders and represent a combination of commodity production and conservation. This is the first of such Outlooks and we intend to publish one regularly to inform of additional future initiatives and opportunities.

Investment Opportunities

PALM OIL

This initiative is driven by downstream palm oil companies that are sourcing palm oil from Siak in collaboration with the government sector and civil society to achieve more effective sustainable palm oil production through multi-stakeholder collaboration.

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PINEAPPLE

The local commodity that many people in Siak grow on peatlands is pineapple. Improving peatland management and water management in pineapple cultivation will support improving the quality of peatlands and reduce the potential for land fires that often occur during the dry season.

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SAGO

Apart from being a commercial commodity, sago is also one of the staple foods of the Siak community. Sago is an endemic plant suitable for cultivation on wet peatlands. Improving peatland management and water management in sago cultivation will support improving the quality of peatlands and can reduce the potential for land fires that often occur during the dry season.

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BEE HONEY

The honey business is very prospective during the pandemic. In recent years, Siak District has experienced an increase in the number of honey bee keepers. Several types of honey bees that are cultivated in Siak are Apis mellifera, Apis dorsata and of the Trigona genus. For Apis Melifera honey bees, some people cultivate them in oil palm plantations.

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SNAKEHEAD FISH

Cultivation of snakehead fish on peatlands is the right choice to keep peatlands wet. This type of fish lives in peat waters and has a high survival rate. In local tradition, snakehead fish is processed into food that can be useful for wound healing and contains high albumin and protein which can overcome various diseases in the human body.

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ZAMRUD NATIONAL PARK

Zamrud National Park is a conservation area that is part of the Pulau Besar Wildlife Reserve in Siak District. It covers an area of ± 31,480 hectares and is designated as one of 52 national parks in Indonesia. The landscape consists of lakes and islands. The lakes included in the area are Pulau Besar Lake (2,416 hectares) and Lake of Bawah (360 hectares). Pulau Besar Lake has four islands, namely Pulau Besar, Pulau Tengah, Pulau Bungsu, and Pulau Beruk. Zamrud National Park is inhabited by 38 species of birds, 12 of which are protected.

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BUNGARAYA AGROTOURISM

The Bungaraya area is an integrated agro-tourism center that is being developed and managed creatively by young people and the surrounding community who are member of the Community-based Tourism Group (Kelompok Sadar Wisata/Pokdarwis). They are intensively assisted by the government and civil society organizations. Several of the interesting tourism destinations including flower gardens, biodiversity parks, and viewing posts.

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PALUDI CULTURE IN LAND

TORA is an area or land controlled by the state and/or owned by the community to be redistributed or legalized. In Siak, approximately 10,000 hectares of TORA have been redistributed to the community. The local government aims for this peatland to be managed with sustainable principles considering most of TORA’s is deep peatland that requires careful management. Apart from having economic value, the use of this land can also restore degraded peatlands.

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Contact Persons:

Bayhaki
Promotion Unit of Investment Planning Office
DPMPTSP of Siak District
Email: bayhaki.bh@gmail.com
Mobile number: +6285228337096

Wan Muhammad Yunus
Green Siak Secretariat
Email: yunuswan64@gmail.com
Mobile number: +628127510844

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Acknowledgement

In an unusually blunt assessment, a group of scientists early this year warned of the catastrophic consequences of climate change. Their paper, “Underestimating the Challenge of Avoiding a Ghastly Future”, published last month, presented ample evidence that our environmental conditions are much more dangerous than commonly believed. Almost as dangerous is the chronic underestimating of the perils of climate change by leaders and governments, leading to the failures to achieve the already established sustainable development goals. The Paris Agreement adopted at the Paris climate conference (COP21) in December 2015 set the 1.5–2 degrees Celsius target to avoid dangerous climate change. However, without huge additional commitments, global warming is expected to reach 2.6–3.1 degrees by 2100, even if present commitments are achieved – an impending catastrophe for biodiversity and humanity.

This policy brief seeks to distil the experiences and application of the jurisdictional approach to curb deforestation and promote forest-positive commodities in Indonesia. This policy brief documents past and current experiences of jurisdictional approaches, initially at the global level and how conceptually been contextualized and consolidated in Indonesia, notwithstanding there remains challenges but also opportunities both at the national and subnational levels.

In April 2020, PT Dharma Satya Nusantara Tbk. (“DSNG”) signed a USD 30.0 million 10-year loan facility from Stichting andgreen.fund (“&Green”), a globally-focused impact investment fund financing sustainable commodity production to protect tropical forests.

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DSNG, an Indonesian business group focusing on wood and palm oil sectors, was already known to be committed to the production of certified sustainable palm oil. It had been, for example,
a member of the Roundtable on Sustainable Palm Oil (“RSPO”)2 since 2012. It has also consistently implemented Environmental, Social and Corporate Governance (ESG) as an integral component of its corporate strategy policy in both its palm oil and wood product business segments.

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One indication of the company’s commitment was the rise of its ranking in the 2020 SPOTT or Sustainability Policy Transparency Toolkit. DSNG went from 46th in 2019 to 16th in 2020, a big jump that made it the highest ranked Indonesian-headquartered company among the 100 palm oil companies assessed worldwide.3 SPOTT, an initiative developed by the Zoological Society of London assesses the transparency of 100 palm oil companies worldwide regarding their ESG policies.

What is the investment case for sustainable and low-carbon development in sub-national jurisdictions? How could it be realized? What is the structure that is more favorable for investors? What needs to be done at national and sub-national levels to ensure that jurisdictional approach can be well-designed, well-implemented, and well-financed?

This paper shows that jurisdictional approach is an attractive and investable approach when structural and technical imperatives towards its investability are properly addressed. Specifically, the paper addresses the adjustments required to meet the confidence and appetite of investors to invest in jurisdictional approach. Some adjustments may be needed in the structure of the incentives to entice actions to halt deforestation, such as that financial instruments that allows for large-scale financing be managed properly; regulatory instruments that need to be in place to facilitate investor-friendly jurisdictional approach; institutional setting that allows for multi-stakeholder and multi-level planning, implementation, evaluation, and overall governance; and capability to carry out jurisdictional approach at the sub-national level.