PP Peak Losses Rp76.04 Trillion

By : Herry Barus And Aldo Bella Putra | Monday, December 18 2017 - 14:00 IWST

Tanah Gambut (Ali Fahmi / jurnalbumi)
Tanah Gambut (Ali Fahmi / jurnalbumi)

INDUSTRY.co.id - Jakarta - The results of a study by the Institute for Economic and Social Research (LPEM) of the University of Indonesia estimated that the economic losses after five years of PP 71/2014 jo PP 53/2016 on Peat Ecosystem Protection and Management (PP Peatlands) reached 5.72 billion US dollars or around Rp76.04 trillion.

In a written statement received in Jakarta, Sunday (17/12/2017) mentioned, the loss comes from reduced national GDP, community income, and reduced labor.

LPEM Senior Researcher at the University of Indonesia Riyanto said PP Peat and the regulations of ministers of Environment and other Forestry will have an impact on the reduction of industrial timber estates (HTI) and plantations, especially oil palm in Indonesia.

The next impact is the reduction of raw materials for the pulp and paper industry and the palm oil processing industry, so that the import of raw materials is unavoidable and ultimately leads to a drop in industrial competitiveness.

"This PP will have an impact on the macro economy, lower investment rating, and provide a social impact, namely layoffs that will increase unemployment," said Riyanto in Yogyakarta.

Based on the LPEM study, the loss due to peat PP over the next five years comes from a decrease in raw material production by 16.8 million cubic meters due to the reduction of 58.5% of HTI area of ​​702.56 thousand hectares (ha) with an economic value of Rp48.5 trillion.

While output to Riau Province will decrease Rp29,17 trillions per year, besides PDRB Riau will decrease Rp16,15 trillions per year.

Community income will decrease Rp4.9 trillion per year in the form of wages / salaries paid. In addition there will be a reduction of 134 thousand workers over the next five years.

That condition, according to Riyanto, will cause new social problems because of the risk of increasing poverty for about 539 thousand people in the region, assuming each worker to support four family members.

"This impact will lead to serious social problems if not anticipated," he said.

He considered, the publication of PP 71/2014 jo PP 53/2016 reflects the absence of institutional innovation in the management of peat.

The PP will hit the pulp and paper industry because more than 40 percent of the HTI plantation that supplies industrial raw materials is in peat lands, which because the PP should be converted into a protected function.

"This rule not only negatively affects the investment climate in the region (especially Riau and South Sumatra), but also makes the existing investors and will invest in the region withdraw," he said.

Riyanto added that environmental aspects such as fire, CO2 emissions, and floods, which became the basis of the issuance of PP is important, but in fact regulation innovation can still be done, for example obliging business actors to implement environmentally friendly peat land management and so on.

Other efforts can also be done by involving the community and local government so that environmental aspects can be achieved without disturbing the production process of HTI.

According to Faculty of Law Faculty of Atmajaya University Kristianto Silalahi, every development has an environmental impact but it does not mean because of the impact the government does not implement development.

"A solution must be sought so that environmental and economic interests can go together," he said.

He explained that the law is obliged to protect all environmental and community interests including business actors.

Conservation requires validation of data that can be accounted for in order not to cause polemics and problems in the future. In addition, the law must be a transitional process that is carried out in an orderly manner and reliable (trustworthy). (Ant)

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