2017 - 2019


Enabling REDD-Oriented Forest Management and Investment in East Kalimantan, Indonesia

Key Staff:

Tillem Burlace


East Kalimantan has been selected by GoI as the pilot province for trialing a national REDD+ program with sub-national jurisdictional implementation under the Forest Carbon Partnership Facility (FCPF). If the proposed program is approved, the provincial government and its partners will implement a range of actions and policies designed to avoid or mitigate GHG emissions from forest loss and forest degradation. The FCPF Carbon Fund, managed by the World Bank, will make payments for verified emissions reductions monitored and reported by the national REDD+ authority in the Ministry of Environment and Forestry (MEF). The FCPF could potentially allocate more than USD 100 million to Indonesia between 2018 and 2024.

It is anticipated that these revenues will be distributed through a benefit-sharing scheme with provincial and other sub-national jurisdictional actors. It is also anticipated that many of the actions under the FCPF program will be implemented through the provincial network of Forest Management Units (FMUs).

This project has been developed to support the provincial Forestry Agency to strengthen the capacity and readiness of forest management units to contribute to and derive benefits from the proposed FCPF program. The support will consist of two components: (1) assessment of forest potential, biodiversity, and socio-economic dimensions for FMUs without completed management plans and (2) business planning for operational FMUs with management plans.


The Forest Management Unit (FMU) or Kesatuan Pengelolaan Hutan (KPH) conceived in 1999 and now at center stage, represents a strategic solution for forest development in Indonesia. It is expected that 340 KPHs will be established and operational by 2019 (including 21 in East Kalimantan). Thus far 90 are operational, yet capacity to deliver is low. The KPH is the main vehicle to link national and decentralized policies and practices. The new Law on Regional Autonomy has strengthened the role of the KPHs as the key focal point for sustainable forest management (SFM), including licensing at the provincial level. In order to be fully operational, KPH has to meet the following requirements: (i) legalised Rencana Pengelolaan Hutan Jangka Panjang (Long Term Forest Management Plan); (ii) Rencana Pengelolaan Hutan Jangka Pendek (Short Term Forest Management Plan); and (iii) Business Plan on how to make the FMU independent and self-supporting.

The KPH plays a strategic role in improved forest governance as it is mandated to: i) conduct forest governance and zonation within the KPH area; ii) develop forest management plan within KPH area, including sustainable KPH development plans; iii) carry out development, monitoring and evaluation on forest management conducted by the permit holders; iv) carry out forest rehabilitation and reclamation; v) ensure adequate protection of forests and conservation of biodiversity, natural resources and ecological functions; vi) implement sustainable production oriented management of specific areas of forest under the auspices of Public Service Agencies (BLU) and/or Regional Public Service Agencies (BLUD); vii) translate forestry policy into innovative effective and practical approaches to forest management; viii) ensure the enforcement of forestry law, including safeguarding integrity and functionality of conservation areas (kawasan konservasi) protected forests (hutan lindung), protected zones (zona lindung) and conservation easements; ix) identify and develop appropriate investments in order to support achievement of SFM goals.

This GGGI-funded project will assist provincial authorities prepare for REDD+ results-based finance payments. The project aims to support development of selected FMUs in East Kalimantan. As set out in the Terms of Reference, this will be achieved through a combination of assessments for preparing FMU Management Plans, establishing REDD+ oriented FMU Business Plans and supporting the mobilization of FMUs as BLUDs through targeted institutional development and mobilization of public and private finance. 

  • Component 1: Assessing the conditions of landscapes, natural resources, biodiversity and socio-economic characteristics to support the development of 11 FMUs Management Plans.
  • Component 2: Operationalizing at least 5 FMUs with Business Plans and operational capacities to turn the FMUs into BLUDs.

The two components are technically aligned and operationally inter-connected. Component 1 provides technical information for FMU management planning and frames the wider context that will position the development of FMU Management Plans and FMU Business Plans to achieve REDD+ oriented outcomes. Component 2 focuses on the development of 5 FMU Business Plans that will serve as examples for replication later on in the 11 FMUs now progressing with management planning. Training related to FMU management planning (Comp. 1) and business planning (Comp. 2) cover partly similar topics and hence provide for combined interventions. 



Geography: Indonesia

Date: 2018 - 2019


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