Jakarta saw the corporate "zero deforestation" pact as competition to the government's own standards

By Beh Lih Yi

JAKARTA, July 5 (Thomson Reuters Foundation) - Environmentalists have warned of greater risks of haze and forest fires in Southeast Asia after major palm oil firms ditched a landmark "zero deforestation" pact in Indonesia.

Top producers and traders said last week that the Indonesian Palm Oil Pledge (IPOP) will be disbanded, arguing Indonesia's recent efforts to strengthen its own certification standards were sufficient.

Indonesia, the world's top palm oil producer, has been criticised by green activists for failing to stop the region's annual haze outbreaks - mainly caused by fires started in the country to cheaply clear forests and land for plantations.

IPOP, signed in 2014, was hailed as a historic effort by palm oil firms to agree to new limitations on what land could be cleared for plantations to grow the edible vegetable oil, used in everyday goods from biscuits to shampoo.

Jakarta, which saw the pact as competition to the government's own standards, argued the agreement was too difficult for smallholders to comply with. Smallholders account for about 40 percent of its palm output.

But green groups said disbanding IPOP was a blow to Indonesia's efforts to cut deforestation and fight the annual forest fires, which last year were among the worst on record and cloaked the region in haze for weeks.

"Haze fighting is a joint effort, it is more effective when companies come together," said Bustar Maitar, Southeast Asia forest director at the Center for International Policy, a Washington-based think tank.

"This shows Indonesia, as a main palm oil producer, is losing the momentum to produce sustainable palm oil," he told Thomson Reuters Foundation.

Maitar said the government's own standards, known as the Indonesian Sustainable Palm Oil system, were less strict as they only ban land clearing in so-called primary forests, which have been untouched, and peatland.

IPOP, meanwhile, also prohibits land clearing in forests that have regrown after being cut down or cleared, and bushland that has high carbon content.

"If the palm oil, paper, and rubber industries want to avoid a repeat of the haze disaster, they will need to team up ... to ensure that only suppliers free of deforestation and human rights abuse obtain access to markets," Glenn Hurowitz, senior fellow at the Center for International Policy, added.

Signatories of IPOP included Wilmar, Cargill, Golden Agri-Resources, Asian Agri, Astra Agro Lestari and Musim Mas.

The decision to disband IPOP appears to run counter to recent efforts by the Indonesian government to stop deforestation and halt the annual forest fires. In April, the government announced a moratorium on new palm oil concessions.

A recent study showed forest fires that blanketed Southeast Asia last year released the greatest amount of climate-changing carbon since record blazes in 1997, producing emissions higher than the whole European Union.

(Reporting by Beh Lih Yi @behlihyi, Editing by Katie Nguyen. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women's rights, trafficking, property rights and climate change. Visit http://news.trust.org)

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