VZCZCXRO7810
PP RUEHCHI RUEHDT RUEHHM
DE RUEHJA #0014/01 0030946
ZNR UUUUU ZZH
P 030946Z JAN 07
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC PRIORITY 2658
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUEHRC/USDA FAS WASHDC
RUEKJCS/SECDEF WASHDC
RHEHNSC/NSC WASHDC
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS
RUEHJA/AMCONSUL SURABAYA 1596

UNCLAS SECTION 01 OF 03 JAKARTA 000014 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT PASS USTR FOR KATZ AND BROOKS 
DEPT FOR EAP/RSP and EAP/MTS 
DEPT ALSO FOR OES/IET AND OES/ETC/TED 
USAID FOR MELNYK 
USDA/FAS FOR US FOREST SERVICE-MACKEY 
 
E.O. 12958: N/A 
TAGS: SENV ECON ETRD PREL PGOV ID
SUBJECT: INDONESIA - ILLEGAL LOGGING MOU PROJECT PROPOSALS 
 
¶1. (SBU) Summary:  Embassy Jakarta's Illegal Logging Task Force 
recommends Washington agencies divide the $1 million in proposed 
State Department ESF funds under the U.S.-Indonesia illegal logging 
MOU between the following three activities: 
 
--$550,000 for the enhancement of an existing DOJ-ICITAP project 
with the Indonesian Marine Police to provide specific illegal 
logging related training and support what could lead to high-profile 
and deterrent level interdictions, seizures and arrests at ports and 
at sea. 
 
--$200,000 to support U.S. Forest Service (USFS) collaboration with 
the Indonesian Ministry of Forestry (MOF) to educate the public and 
other GOI agencies about the country's new timber and forest 
legality standard, and assist the Ministry in developing its own 
management structures and operational procedures to implement it. 
 
--$250,000 to assist the MOF in planning field tests of its new 
technology-based log administration system, revenue administration 
system, and timber traceability system in eight logging concessions 
in Kalimantan and Sumatra. 
 
We believe support for these three projects would best complement 
and leverage existing efforts, produce tangible results, and signal 
strong USG resolve to help combat illegal logging. End Summary. 
 
High Stakes 
----------- 
 
¶2. (U) Rampant and unchecked illegal logging continues at an 
alarming pace throughout Indonesia.  At current rates of 
deforestation, most experts believe Indonesia's remaining 60 million 
hectares of forest will disappear in 20 years.  Effectively 
combating illegal logging across Indonesia's thousands of islands 
and vast territory is a daunting challenge.  It will involve a 
complex array of political and economic forces, including the 
military, police, and local governments.  There is an equally 
complex international component representing the demand for products 
made from Indonesian timber.  At the central government level alone, 
more than a dozen ministries and agencies have some formal 
responsibility for combating illegal logging. 
 
¶3.  (U) In the past two months, the USG has made two well-publicized 
commitments to assist the Government of Indonesia (GOI) in combating 
illegal logging.  On November 13, 2006, the USFS and MOF signed a 
Letter of Intent (LOI) to develop technical cooperation in 
sustainable forestry management that will promote the protection, 
conservation, and sustainable use of forest resources and strengthen 
such capacity and capability within Indonesia.  On November 17, the 
U.S. Trade Representative (USTR) and the Indonesian Ministers of 
Trade and Forestry signed a Memorandum of Understanding (MOU) on 
Illegal Logging and Associated Trade.  The MOU constitutes the first 
such agreement for the U.S., a point noted frequently by both 
governments, other interested parties, and the press following its 
signing.  With the U.S. showing a greater commitment to addressing 
this issue, expectations are high.  Given the relatively limited 
funds available to implement the MOU, it will be crucial to choose 
for funding activities that leverage as effectively as possible 
actual deterrent results and enhance perceptions of the USG 
commitment to the issue. 
 
¶4.  (SBU) In this context, Embassy Jakarta's Illegal Logging Task 
Force recommends dividing the proposed $1 million in State 
Department ESF funds to support the illegal logging MOU between the 
three projects described below.  We believe the three activities 
complement each other very well, and also have the benefit of 
leveraging additional existing anti-illegal logging projects, both 
of the USG and other donors. 
 
DOJ-ICITAP Marine Police Project 
-------------------------------- 
 
¶5. (SBU) DOJ-ICITAP is currently implementing a large scale law 
enforcement capacity building and assistance project for the 
Indonesian Marine Police (IMP).  The project serves as the 
cornerstone of our maritime security efforts with the GOI, and 
includes the provision of 15 high-speed shore patrol vessels to 
conduct surveillance and interdictions in strategic waterways in the 
Straits of Malaka and North Sulawesi Sea.  As part of the project, 
 
JAKARTA 00000014  002 OF 003 
 
 
DOJ-ICITAP is training four IMP operational units in investigation, 
policy, and operational procedures.  These units now have round the 
clock operational capacity to patrol high traffic coastal areas and 
interdict suspicious vehicles, including those involved in illegal 
fishing and trade in illegal logs and timber.  Thus far, the 
DOJ-ICITAP project has supported a 300 percent increase in INP 
maritime seizures and criminal cases filings. 
 
¶6. (SBU) Among its recent successes, the IMP has interdicted and 
seized significant quantities of illegal timber, processed lumber 
and oil.  These seizures have received considerable play in local 
press and have added a new element of risk to illegal timber and 
lumber traders.  Part of the IMP's success is due to the 
vulnerability of these shipments while at sea, where they are 
outside the reach of the complex network of powerful local interests 
(local politicians, military and police, and private businesses) who 
support illegal logging on land. 
 
¶7. (SBU) To strengthen the IMP's capacity to combat illegal timber 
and lumber trade, we recommend enhancing the DOJ-ICITAP project with 
an additional US$ 550,000 in ESF funding.  The additional resources 
would support specific trainings for the four IMP operational units 
on combating illegal logging; develop a network of cooperation and 
information sharing between IMP, other GOI agencies, and NGOs; and 
seek to collaborate with a proposed World Bank law enforcement 
project aimed at arresting and prosecuting Indonesia's known illegal 
logging kingpins.  Some of the training could specifically focus on 
ramin identification, a valuable species of hardwood both countries 
recognize as endangered under CITES.  Such training would contribute 
substantially to efforts coordinated through the existing ASEAN 
Wildlife Enforcement Network, which focuses on fauna but is mandated 
to coordinate SE Asia enforcement efforts for all CITES listed 
species. 
 
¶8. (SBU) Funding a specific, anti-illegal logging component for 
DOJ-ICITAP's IMP project would enable us to make a meaningful 
contribution in the area of law enforcement -- arguably the most 
challenging area in combating illegal logging in Indonesia. 
DOJ-ICITAP is a member of the Embassy's Illegal Logging Task Force 
and is currently exploring collaboration with the Nature Conservancy 
on raising awareness with the IMP about Indonesia's new legality 
standard. 
 
USFS Support to Implement Legality Standard 
------------------------------------------- 
 
¶9. (U) With support from USAID grantee The Nature Conservancy (TNC) 
and a local environmental NGO Lembaga Ekolabel Indonesia, the MOF is 
on the brink of formalizing a log and forest legality standard for 
Indonesia.  Once the standard is in place, the MOF will require 
assistance to educate the public and other GOI agencies about the 
standard and to develop its own management structures and 
operational procedures to implement it.  The USFS has invaluable 
expertise in these areas that it could share with the MOF and others 
through short-term TDY consulting assignments and training programs. 
 
 
¶10. (U) Such an activity would fit well with the USFS's commitment 
in its Letter of Intent to develop activities supporting 
legislative, administrative, and public outreach aspects of forest 
resource management; strengthening processes for forest governance 
and transparency; and building capacity at all levels and improved 
field operations.  Equally importantly, resuming direct cooperation 
with the MOF would also signal U.S. commitment to implement the 
broader MOU.  USFS trainings could be tailored to support 
DOJ-ICITAP's complementary work with the IMP.  USFS assistance would 
also build on TNC's progress to date and complement its future 
regional efforts. 
 
¶11. (U) (Note: USAID/Indonesia funding for the TNC ends in March 
¶2007.  With funding from the USAID Bangkok Regional Mission, TNC's 
new Responsible Asia Forestry and Trade (RAFT) project will take the 
lessons learned from efforts in Indonesia and expand them 
regionally. The project will promote responsible timber trade and 
sustainable management of forest resources and biodiversity in Asia, 
with a focus on Indonesia, Malaysia, Vietnam, Cambodia, Lao PDR, 
Singapore, Papua New Guinea, plus Japan, China and the United 
States.  End Note.) 
 
 
JAKARTA 00000014  003 OF 003 
 
 
Operationalize Timber Legality Standard 
--------------------------------------- 
 
¶12. (U) The MOF is planning to field test its new legality standard, 
technologically based log administration system, revenue 
administration system, and timber traceability system in eight 
concessions - five in East Kalimantan, two in West Kalimantan, and 
one in Riau, Sumatra.  The MOF and the World Resources Institute are 
also digitally mapping and placing in a geographic information 
system all forest and plantation concessions and, soon, saw and pulp 
mill operations. 
 
¶13. (U) The MOF requires assistance to establish and implement 
procedures to share critical information internally as well as 
improve communication with law enforcement agencies.  These 
procedures would be field-tested in the eight concessions identified 
by the MOF.  We believe that USFS expertise would be invaluable in 
assisting the MOF in this area, and would track with the USFS's 
commitment to help MOF improve the use, communication and sharing of 
technical information related to commercial forest resources. We 
recommend providing $250,000 to USFS to support this initiative. 
Supporting field-based work within a limited number of concessions 
would complement the other projects proposed through information 
sharing to curb illegal logging. 
ANDERSON