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Indonesia accused of putting profit ahead of environment

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Christian Fernsby ▼ | February 13, 2020
Indonesia’s plans to relax environmental rules to encourage investment have drawn criticism from activists who say the government is putting profit ahead of protecting the archipelago’s rich natural surroundings.
Joko Widodo
Business in Indonesia   Joko Widodo
The “Job Creation” bill, submitted to parliament yesterday, aims to open up industries and includes proposals to relax the need for companies to conduct environmental studies and eases rules on coal mining.

Topics: Indonesia environment

It is one of President Joko Widodo’s so called “omnibus laws”, which aim to change scores of existing laws to cut red tape and attract investment into Southeast Asia’s largest economy.

Types of businesses that require an environmental study, known as an AMDAL, will no longer be specified and subject to separate, lower level regulation.

Currently, companies that exploit natural resources must conduct an AMDAL, which is intended to assess the impact of the investment on the environment and local community.

The new bill also removes all mention of AMDAL requirements in the 2014 Plantation law. Plantations, particularly for palm oil cultivation, are often blamed for causing deforestation in Indonesia, the world’s biggest palm oil producer.

Business groups have backed the new law but Greenpeace’s forest campaigner Asep Komarudin said it could mean companies might now not take into account an investment’s “environmental, social and health complexities at the site level”.

“This can lead to the accumulation of unmanaged impacts and even ecological disasters,” Komarudin said, citing last year’s forest fires in Borneo and Sumatra, floods in Jakarta in January and drought in the southeastern part of the country.

As part of the bill, the government is also seeking to remove an existing rule allowing residents who may be affected by an investment to object during an AMDAL process.

Defending the bill, President Widodo said in an interview with BBC Indonesia this week that he cared about the environment, but “we are prioritising things related to the economy because the people need jobs.”