The Needs of Integrated Knowledge System in Implementing and Designing Sustainable Water Management In Indonesia

Background

How would it be if a dressmaker makes a dress without pattern? The dress might not look good and perhaps it will not fit with the model. And, off course, everything does not work as what the dressmaker wants.

That is why a pattern is a must!

In the same way, philosophy of pattern is also applicable to water management. One needs to design the water system first based on the condition and then correlate it with sufficient knowledge.

In Indonesia, actually, there are many institutions do researches related to water subject. The topics are varies greatly, which talk about water resources, water engineering, water policy, and other relevant subject.

Lembaga Ilmu Pengetahuan Indonesia (LIPI) or Indonesia Science Research Institution, Badan Pengkajian dan Penerapan Teknologi (BPPT) or Institution for Technology Development and Implementation, and Badan Perencanaan Pembangunan Nasional (Bappenas), or National Development Planning Institution, are some of main institutions in Indonesia that held water researches. They held their own research based on the needs and the trends of world water technology.

Each institution developed its own expertise as it was a whole subject itself. And, actually, the quality of the researches is being recognized internationally. They produce quite hi-tech and sophisticated research for a country like Indonesia.

Unfortunately, most of these researches do not apply in Indonesia water management as an integrated system. They run separately. One water research has no connection to other relevant water research. Otherwise, government doesn’t really give enough attention to merge and make a linkage between one research and another.

And most of these researches did not fit the real condition and other water system components. The water policy did not support water technology researches and vice versa. Why?

Analysis

If we talk about water management, we talk about scientific and socio aspects of it. Water, it has scientific dimension, where water is a commodity that we can develop and renew whenever scarcity happens. That is why scientific research is necessary for water management.

But, to see water as a basic need of human being means that we have to admit that water also has its socio dimension. Water is a commodity that needs regulation and policy in order to make all people consume water equally.

So, It supposed that science research and policy research have a simultaneous correlation each other. Because, both of them are one package of a water management if a country intend to maintain good governance in this field.

In order to do that, there should be a systematic mechanism, which makes researches in water management subject correlate each other. This mechanism should be the bridge that makes the knowledge behind those researches became an useful aspects in Indonesia water management.
What kind of mechanism?

Researches in water management should be arranged in a model system. This model is just like a method that makes knowledge behind a research connected another relevant researches. So, these researches will come to the same problem solving in water management.

This model keeps all researches in water management on the same track, so probably it makes easier for Indonesia to achieve its water management goal.

Factors Affecting Possible Development and Possible Solutions

Both the research institution in water scientific researches and policy research are generally did the good work. So, it is not a problem on how to increase the quality, but it is more important to match them each other.

In terms of make the correct modelling for this water management, Indonesia government need to rearrange water research system. All of government research bodies should run an integrated research based on Indonesia water management goal.

Recommendations

There should be a systematic and integrated system in bridging the scientific and policy aspects in order to maintain sustainable water management. A modelling, which regulate the implementation of research in water subject and the government policy in water should be apply, so scientific aspects of water management meet the government’s “how to do” to conclude a policy. With this modelling, there is a synergy between reality, research, and political will of the country.

taken from Collaborative Platform UNESCO-IHE website

References

Bappenas website, http://www.bappenas.go.id/
IRC website, http://www.irc.nl/
BPPT website, http://www.bppt.go.id/

VALUING THE ECONOMIC IMPACT OF DEFORESTATION OF LADIA GALASKA ROAD CONSTRUCTION IN LEUSER ECOSYSTEM, INDONESIA

by Tomi Haryadi

The Existence Leuser Ecosystem

It is widely believed that national conservation area Mount Leuser, Aceh-northern Sumatra, Indonesia, is the most complete and representative conservation area in the world. This ecosystem covers areas of some 26,000 sq.km, or 2.6 million hectares, consists of tropical rain-forest with its diverse flora and fauna. This conservation area lies in area of almost as large as Belgium. (Media Indonesia, 2005)

Beside the wide area and diversity, it is also fringed by two major volcanic calderas, and contains a volcanic plateau, a rift valley, four spectacular volcanoes, two lakes, 13 major river systems, as well as numerous hot springs and fumaroles, and many 3,000 meters high mountain peaks, including Mount Leuser that rises to 3,455m. The main vegetation types comprise coastal beach forest, swamp forests, lowland dry forest, riparian forest, hill dipterocarp forest, sub-montane forest, and alpine meadows (Ministry of Environment, 2002).

But actually, not all parts of this Leuser ecosystem are located in the province of Aceh. Only 80% of this area is located in the province of Aceh, and the rest occurring in the province of North Sumatra.. The boundaries in Aceh were gazetted in 2001, whilst those in North Sumatra were gazetted in 2002. Excluding the west-coast swamp forests, and the lowland Sikundur Wildlife Reserve, most of the Leuser ecosystem is situated on slopes of 40% or more, that should by law become protected forest.

The designated Mount Leuser National Park is situated inside the Leuser Ecosystem, and comprises about one third of the total size of the Ecosystem. Except Sikundur, most of the National Park is high mountains, and is not large enough to contain viable populations of three of the endangered large mammals – the Sumatran tiger, Sumatran elephant, and Sumatran orangutans.

Benefits of the Leuser Ecosystem to local communities

The Leuser Ecosystem acts as a life-support system for more than two million indigenous people that rely on the ecological services provided by an intact ecosystem. The primary service is fresh water required to sustain the livelihoods of local people that live around the ecosystem.

There are thirteen major river systems arising in the ecosystem. According to Buekuering (2002). The water-catchment’s area of just one of these rivers, has rainfall catchments of 20 billion cubic meters of water per year. The forests of the Leuser Ecosystem act like a sponge to soak up this water and spread out its release downstream more evenly across the months.

When undisturbed, they dampen out the peaks and troughs, thereby preventing flash floods and regulating the water supply to prevent prolonged droughts. They sustain the local rice-growing cultures by ensuring a reliable source of fresh water for drinking, bathing, transportation, and supplying the fisheries and agricultural sector. The Ecosystem also provides non-timber forest products such as rattan and bamboo, which are harvested by local communities.

The road Named Ladia Galaska

In her speech on The Bill on The State Budget For the 2005 Fiscal and its Financial Note the former President Megawati Soekarnoputri stated …” Road construction had been carried out to support regional development………Included in the development of Trans-West Sumatra is the construction of Ladia Galaska road in Nangroe Aceh Darussalam, which in fact is requested by people living in the southern part of that province, in order to open up the isolation of the area. It is for this reason that the road crossing the island from the eastern to the western coast is being built.” (Embassy of Indonesia, Ottawa, Canada, 2004).

The road is named Ladia Galaska because it lead from the coast of the Indian Ocean (Lautan Hindia=Ladia) through the main centers of two indigenous peoples' groups, the Gayo and Alas (=Galas), to the east coast by the Malacca Straits (Selat Malaka=ka) (See map as Annex). The Ladia Galaska road network was proposed to cut through the Leuser Ecosystem in at least nine places. It ignores all legal environmental impact assessments (EIA's), and cuts through `protection forests', non-conservation forests that have an average slope of 40% or more), as well as conservation forests (including the designated Mount Leuser National Park).

Finally, the federal government support the road construction with the financial from the national budget amount US$ 10.2 Million (Media Indonesia May 27, 2005).

Total Economic Value

Services of ecological systems and the natural capital stocks are critical life-support system. They contribute to human welfare both directly and indirectly. This contribution can be measured as total economic value (TEV). TEV becomes a centre of efforts to better integrate the environmental consideration to economic decision making. The integration, hopefully, will in turn lead toward sustainable development.

Total economic value incorporates actual use values plus non-use values that express the range of social economic values associated with society's use and enjoyment of the natural world. Total economic value consists of direct use values and indirect use values. Non-use value includes existence value, option value, bequest value, altruistic value, and the value of ecological services

Direct Use Value

Use value is one of the general economic concepts used to define the total economic value by evaluating the changes in people prosperities. Use value is estimated by how much benefit and yields that people directly or indirectly derive from the natural environment including forests, river areas, agriculture, and oceans. Use value is calculated by adding the direct use value and indirect use value.

Direct use value is estimated by calculating the amount of direct extraction from natural resources and the associated value using a market price. Direct use value consists of timber and non timber. Value of timber is how much timber sold sent to market multiplied by the market price. Value of non timber components are calculated item by item.

Indirect Use Value: Ecosystem Services

Indirect use value is a means to measure the function of forest products and the social costs that are worthless in terms of market price using the benefit-transfers-data methods. Benefit-transfers data is the transfer and application of estimates of economic benefits of particular resources from previous studies to a site for which no such benefit values are available. The transfer of benefits assumes that the value of the resources in question is the same or similar value across the different sites. The indirect value is estimated by transferring the data that already exists.

Carbon sequestration
Carbon sequestration is estimated through how much carbon dioxide (CO2) the forest can absorb to produce oxygen. Potential benefit of sequestration is improvement of air quality (CO2/O2) exchange, and reduction of green house gas especially CO2.

Erosion Prevention
Deforestation is causing nutrient leaching from soil that leads to marginalization. Sediment transported to reservoir will block hydroelectric power etc. Upstream soil erosion can lead to excessive sedimentation in the turbines causing frequent interruption of power supply and highest operational cost. Sedimentation can change river profiles and flow characteristics by reducing water depth, widening channel and slowing flow, leading to increase evaporation and rates of water loss.

Flood control
Deforestation can increase flood event. The flood can cause human death, destruction of settlement, and agricultural area. Deforestation may increase flood event.


Pollination and pest control
Pollination and natural pest control services are important in many landscapes. Primary and secondary forest is source of pollinating insect and natural pest control. That why the agricultural productivity are proportional with the remaining forest near cultivated area (van Beukering, 2002).

Water retention and quality
Tropical rain forest soil rich in organic matter that has sponge effect. This effect increases the capacity of forest to store water. Deforestation will decline volume and regularity of fresh water flows, reduces quality, increase turbidity and stream biodiversity.

Non-Use Value

Non-use value is the benefit that people receive from nature without directly using natural products or perceiving the value. Non-use values can be measured by travel cost demand, hedonic property values, and contingency valuation models. Non use value consists of option value, existent value and bequest value.

The option value is the extra payment an individual is willing to pay to ensure that one can make use of the forest or natural resource in the future. The option value is represented the potential benefits, as opposed to the actual present use value.

The existence value is a value that is placed on the forest area or natural resource area that has relationship to any actual or potential use of the good. Examples of goods include timber, wildlife, and water management.

The bequest value is the measure of willingness of someone the to reduce the consumption of products that are usually derived from the forests area, combined with ones regular annual consumption of forest products.

Total Economic Value of Leuser Ecosystem

Costanza et a1 (1995) estimated current economic value of 17 ecosystem services for 16 biomes in the world. We realize that there are some differences of the ecosystem in the world, but we consider that tropical forest ecosystems are nearly similar so we try to derive the result of their study to estimate the total economic value of Leuser Ecosystem as seen in Table 2. The values they found in 1995 are discounted 4 % for 15 years to find current value (2006). The research is US $ 18790 for the whole area of Leuser ecosystem 842,000 ha is US $ 15,8 billion or about 0,009 % of world ecosystem value.

Van Beukering (2002) conducted the study aim to determine the Total Economic Value (TEV) of the Leuser Ecosystem and evaluate the consequences of deforestation for its main stakeholders. They evaluate TEV of Leuser ecosystem under three possible future scenarios: (1) the conservation scenario, implying that protection of rainforest is strictly enforced and thus logging will be excluded as economic activity, (2) deforestation scenario, implying a continuation of the current trend of clear cutting; and (3) selective use scenario, implying selective combination of the previous two.

The accumulated benefit (NPV value from year 2000 to 2030 discounted by 4 %) under conservation scenario is the 30 % higher than under deforestation scenario. Under deforestation scenario Agriculture take greatest proportion followed by flood prevention and timber, whereas in the conservation scenario water supply take greatest proportion.

Deforestation may be considered an easy way to generate fast cash. In the long term, however, the negative consequences will dominate. According to van Beukering (2003) in the deforestation scenario, ample revenues are generated in the first seven years. After that revenues decline. The conservation scenario shows a steady increase in annual benefits throughout the 30-year period.

Impact of Deforestation on Main Stakeholders

Besides the overall economic value, the distribution of this value among the different stakeholders is important. This is to identify which stakeholders accepted greatest impact of deforestation. Van Beukering (2002) identified five stakeholders in Leuser Ecosystem: (i) local community; (ii) local government; (iii) elite logging and plantation industry; (iv) national government; and (v) international community.

What is the proportion of TEV among stakeholder? Contrary to popular belief, the local community (the main beneficiary of the Leuser ecosystem) receive approximately 60 percent of the benefits. These benefits mainly result from the support of agriculture and the prevention of floods. Therefore, conservation will further benefit all categories of stakeholders in society, except for the elite (logging and plantation) industry.

Ladia Galaska: Road and Its Economic Impact

The road network cutting through forest areas will lead to a massive wave of illegal logging, encroachment and settlements inside the Leuser Ecosystem. Once the first waves of local people move in along the main roads, this will then lead to dozens of finger roads off each main road, each with the same effect of eventual forest conversion for the `benefit and development of the people.

This will lead to the destruction of all the areas of highest biodiversity in the lowland and hill forests, leading to the local extinction of all the endangered large mammals, followed eventually by hundreds of other species, including species of lowland plants of unknown benefit for human welfare.

Because we did not find any data of feasibility of study of the Ladia Galaska Road Construction, we could not find financial analysis as basis for calculating loss and benefit. We try to trace benefit from GDP of Indonesia Instead. According to the Fact Book (2006) Indonesia is US$901.7 Billion and economic growth 5.4 %. We assume that the growth is constant to make calculation simple.

Money spent for road building is US $ 10.2 Million or 0.001% of the GDP or US$ 9.11 Million. This amount of money in 25 year will become US$ 9.11 (1+0.045)25 = US$ 33.6 Million. We consider this amount of money as net benefit cumulative for 25 year, and in fact only 0.4 % from TEV of conservation scenario.

If the road the road is built by cutting the Leuser Ecosystem the potential loss are as follow:
- The road length 500 km and width 10 m is equivalent with 450 ha of forest area, this economic value of this forest is US$ 8.5 Million (based on Constanza et al (1999)).
- The consequence of road building is the increase of deforestation rate. According to the estimate of Ministry of Environment (2002) the rate of deforestation will be 8000 ha per year so the destructed forest in 25 year will be 200000 ha, this equivalent with US$ 3 758 Million.
- The consequence of road building by Leuser ecosystem is the suspension of EU donation amount $31 Million Euro per year (Media Indonesia, 2005).

- So the total loss would be more than US $ 3766, 5 million

The above figures, confirm us the economic loss of road building by cutting Leuser Ecosystem is far greater than the benefit we accept from it.

If the government of Indonesia forces to built the road with no other alternative, then its credibility will be deteriorating among international financial institution (World Bank and Asian Development Bank, for example) because they committed to their policy for not supporting development that destructing environment.

Conclusion

Over a 30-year long period, a deforested Leuser Ecosystem generates a lower economic value than a conserved Leuser Ecosystem with a difference value of US$ 5.8 billion over this period at a zero percent discount rate.

Conservation of the Leuser Ecosystem benefits all categories of stakeholders in society, especially the local community.

Because Ladia Galaska construction across Leuser Ecosystem create negative economic impact, construction of this road is not feasible.

Recommendation

Because all categories of stakeholder benefit significantly from conservation of the Leuser Ecosystem, Government of Indonesia should promote a strong incentive for all to stakeholders develop and enforce a common plan on conservation.

We are not recommending the construction of Ladia Galaska go ahead by crossing Leuser Ecosystem. We suggest the Local Government, Provincial Government and Federal Government to take other alternatives of route where settlement/residential are concentrated.

Alternative 1 is through north-westward along Hindia Ocean and Sabang Port and continues to Malaka strait.

Alternative 2 is through Kabanjahe (North Sumatra)- and to Malaka Strait. Because people are concentrated in this route the road construction is potentially to have highest economic impact and good ecological impact.