REPORTER: Ginny Stein

The beginning of a day-long boat ride up Indonesia’s longest river, the Kapuas.

上海性息

It's the only way to reach the roads and tracks that will take me deeper into the heart of Borneo. I've come to see what the impact of the decline of illegal logging and the rapid spread of oil palm plantations has had on the island of Borneo, a two week journey to some of the most remote parts of an island shared by three countries – Malaysia, Brunei and here in Indonesia.

Nine hours by road and two hours by speedboat and I’m still yet to reach the start of the primary growth forest. Indonesia is estimated to have lost three quarters of its ancient forests. The journey to reach here, into the heart of Borneo, demonstrates the impact that deforestation has had on the island.

Once all of this was dense forest, but decades of logging and clearing have left little evidence of what was once here. Indonesia has cracked down on illegal logging in the face of strong international pressure. It's no longer on the scale it once was but you don't have to go far to see that it's still taking place. Yuyun has spent years tracking the movement of illegally logged timber.

YUYUN: In this part it is normal. Timber comes from inside national parks to outside, yeah, but I curious the legality of this timber because there is no company, no legal company, surrounding this area.

For as long as logging has provided people jobs, the river has been the way timber has been transported out. On these boats are river scavengers, collecting logs from the river bank left behind after authorities moved to shut illegal logging down. But when these men can't find what they need, they take to the forests.

MAN, (Translation): We cut down the trees ourselves in the jungle.

MAN 2, (Translation): Our stomachs force us to do this work. We do it for food. So…for example, we sell something, one or two logs. Timber like this could be milled and used to build houses.

Now once again forests are being cleared, only this time range forest timber is a bi-product. It's the land they're after, for oil palm. In a world hungry for power, it's a source of the alternative fuel bio-diesel. Already palm oil is the world's cheapest and best selling vegetable oil, earning Indonesia billions of dollars. Indonesia is the world's largest producer and currently ranks second behind Malaysia in global palm oil exports. Millions of hectares are already under cultivation and more is being cleared but this is just the start. Indonesia has high hopes palm oil will become the new green gold. Forestry Minister MS Ka'ban sees palm oil as having great potential.

MS KA’BAN, FORESTRY MINISTER, (Translation): At the moment, the government is taking initiatives aimed at diversification in the field of bio-energy. One bio-energy initiative is bio-diesel. One resource for bio-diesel is palm oil.

REPORTER: Indonesia's plan is become to number one exporter of oil palm, is that right?

MS KA’BAN: Maybe.

REPORTER: You would like to see it?

MS KA’BAN: To be number one.

It is oil palm's potential as a renewable petro diesel replacement that's captured the interest of the Indonesia Government and logging companies looking for new investment opportunities. This is a low maintenance plant. Hack the fruit from the tree and squeeze the oil out of it, then refine it. Bio-fuel doesn't get much simpler. Palm oil is also one of the most versatile oils imaginable and used in a myriad of products – from potato chips to lipstick, to instant noodles, or pick it straight from the tree.

MAN, (Translation): First you wash the oil palm fruit. After you wash it, you boil it for about half an hour. After that you let it cool. Then you eat it.

As more land and lowland forests are being cleared for oil palm to be planted, debate is growing about this plant's environmental credentials. But the problems cut deeper than the loss of the forest alone. Last year's burnoff saw more than a billion tonnes of carbon dioxide go into the atmosphere from rainforest fires set deliberately to clear new land for plantation. Deforestation is now the second greatest cause of greenhouse gas emissions after the burning of fossil fuels. Indonesia's Environment Minister Rachmat Witolear acknowledges there are problems.

REPORTER: The concerns raised by environmentalists about the impact of oil palm, do they have a point?

RACHMAT WITOLEAR, INDONESIA’S ENVIRONMENT MINISTER: Yes, I'm in communications with these groups and I appreciate that they are concerned about this common concern, very concerned. So I try to get the best solutions from their warnings because I do understand that they have a point on that.

Indonesia's palm oil expansion is in part being fueled by a decision made on the other side of the planet. Earlier this year, the European Union mandated the use of bio-fuel. A binding target of 10% for all transport to use biofuel in Europe by 2020 has been set. Hapsoro is a forest campaigner with Greenpeace. It's one organisation that's been attempting to raise debate about the impact of bio-fuel.

HAPSORO, GREENPEACE: We already have the threat, the big threats from Indonesia itself, from the companies within Indonesia, from the intention of the Indonesian Government to become number one exporter of oil palm, of palm oil and also from the Malaysian company coming into Indonesia. So with this new development with the biofuel I think that it will be greater than before, maybe about three times bigger.

This is a plant which in theory has impeccably green credentials, Malaysia, the world's leading palm oil exporter and initiative's business partner, advertises its product globally.

ADVERTISMENT: Malaysia palm oil, its trees give life. And help our planet breathe. It’s fruit provides vitamins for our bodies and energy for our daily lives. Malaysia palm oil, a gift from nature. A gift for life.

But to grow this renewable product, forests are being laid flat. More than 3 million hectares have already been planted on the Indonesian side of Borneo alone. Since the beginning of this year, dozens of new deals to develop bio-fuel plantations have been signed, including one involving the Chinese state-owned offshore oil corporation estimated to be worth approximately $6 billion. This plantation in Borneo's West Kalimantan province is expanding, Hapsoro is shocked to see clear felling on this scale.

HAPSORO: This very bad. This very bad. This is the area that used to be a forest, a big forest before in the West Kalimantan and then logged for the timber, for taking timber, and then not finished yet and now being finished, being cleared out and converted to become oil palm plantation.

8,000 hectares in this area alone are under cultivation. Now, the adjoining forest is being razed for a further 2,000 hectares to be planted. Indonesia maintains it has carefully chosen areas for expansion. Forestry Minister MS Ka'ban says while national parks are out of bounds, forests it considers degraded by past logging are suitable for oil palm.

MS KA’BAN (Translation): Yes Indonesia..is going to expand. And Indonesia has set aside almost eight million hectares, which are outside forest areas.

But Hapsoro says approving the levelling of forests in areas which on paper are listed as degraded misses a key issue.

HAPSORO: Even though it is secretary forest, still have chance to regrowth, to regenerate, to become a big forest again. So it is what they call as a logged forest, but still have trees and still have capacity to regenerate, to become forest, but they consider it just as bare land.

Indonesia's Forestry Minister MS Ka'ban makes this point after seeing footage I filmed of this forest being cleared for oil palm to be planted.

MS KA’BAN (Translation): Such land might be forest..What is it called? Secondary forest. What’s important is that it’s outside productive forest areas. We from the Forestry Department keep a close watch on this.

Indonesia knows its forests are dwindling. But it's caught in a balancing act which pits today's economic survival against the future. And that's where being able to see the forest for its trees becomes a challenge. Indonesia's Environment Minister Rachmat Witolear.

REPORTER: That land is meant to be cleared land already, but it obviously isn't, as you'll see coming up. It's forest. Forest is being wiped out. To plant trees.

RACHMAT WITOLEAR: Yes, but this are not big, big forest. This could be those that are allowable by the Ministry of Forestry.

REPORTER: But in a time when forests are diminishing to chop down more forest to plant oil palm, it just seems a little bit…

RACHMAT WITOLEAR: There's a slight difference in understanding. These are trees. They could very well be forest. Trees are trees, forest yes big forest. If there's a certain diameter and a certain density, then I think it will fall in the category as a protected area, maybe, maybe.

The changing state of forests is a reality felt most keenly by the people of Lanjak, close to the Malaysian border. This riverside community is now in retreat, sinking back in time to the quiet backwater it once was before illegal loggers came to town. The village of Lanjak was once a major transit point for illegal timber. Throughout the border region, people are now looking for new ways to survive. In communities where the desire to continue logging remains strong, opponents of the introduction of wide-scale oil palm plantations are few.

Ciprianos is one of many here caught between two worlds. Before the loggers came, he was a subsistence farmer who'd lived off the jungle. Then came the chance to earn cash working as a security guard for a timber baron. Now, with his income gone, once more he's returned to the forest for survival, this time as a rubber tapper. He's heard oil palm is coming and is keenly waiting to see what jobs or opportunities that will bring.

CIPRIANOS, (Translation): We can’t just rely on rubber tapping or farming, what will become of our children if they have to do work like this? You can’t make a steady income doing this.

There are many here who would also welcome back illegal loggers with open arms. Agus did well during the town's timber cutting heyday.

AGUS, (Translation): Timber from the lake, from Kapuas, all came here. Deals went through the man who owned this land, it wasn’t just a handful of timber barons reaping the profits. When the wood came here, everyone had work. Yes, things were good, everyone had..they could make a living, everyone had buying power, the profits were enjoyed.

Now with land needed to plant oil palm, he's heard rumours that logging may begin again. Many of the companies involved in logging are now heavily investing in oil palm. In the past year, the share price of Indonesia's largest palm oil producer, Astra Agro Lestari, has doubled in value. But whether it's palm oil or logging, Agus is ready and waiting.

AGUS, (Translation): Of course I would take part.

Rumours that loggers would be allowed back started around the time plans for a major plantation development were uncovered last year. It was to be the world's largest single plantation. 1.8 million hectares, much of it right in the middle of a rainforest between two national parks.

UNJA, (Translation): They can’t possibly plant oil palms on the highest hills, but at the foot of the hills it will all be planted with oil palms. That is according to the plan.

Unja is a traditional subsistence farmer who likes so many other villagers around here, relies on food from the forest to survive.

UNJA, (Translation): This is the way you clean it. To eat it, you clean it. You open it up and remove the bark, once we’ve sliced it we wash it, then we cook it, it is not nice if it is boiled.

He's led local resistance against plans to expand oil palm in this part of forest.

UNJA, (Translation): The government wants a huge oil palm plantation here, we people of Labian village think that’s really a greater threat than illegal logging, because once oil palm is planted we will no longer be able to grow timber trees. All you will see will be oil palms. So from the beginning we were determined to do our utmost to protect our district.

The proposal was dropped after it was discovered that much of the land chosen was too steep and too elevated. The Government now says it wants international help to reforest this area. But its overall target for oil palm expansion remains the same. It's just been forced to look elsewhere. Indonesia's Environment Minister is prepared to admit he does have some concerns about the impact of oil palm.

RACHMAT WITOLEAR: Well, I accept that we should not go overboard in replacing natural or indigenous woods, forests, for plantations because they can harbour bio-diversity and the other is only money. In this case, if it is a money game, indigenous forests, bio-diversity and the future of forests within the context of global change, if it is even more valuable, important than exports of palm oil, which at this point we have quite a substantial bit.

But he says there are other issues at stake.

RACHMAT WITOLEAR: The greatest challenge is giving alternative employment to those who live off the forests and in a very bad way, who live off the previous way of illegal logging. So we have to get some alternative ways of getting their living.

Without alternatives ways of getting their living, there will be little to stop trees being chopped down to feed the demand for bio-fuel. The complexity of how to provide jobs and protect the forest is heightened the deeper you travel into the centre of Borneo. Since the illegal loggers pulled out, roads here have crumbled, there's no money to repair them. I'm told this journey could take five hours or five days, it all depends on the weather and good luck. The big logging operations may have stopped but trees are still being cut down. This two person illegal logging team has not been long at this site.

MAN, (Translation): It’s a good height, that’s a good one, that’s good wood.

But two men armed with chainsaws can make light work of forest. Neither of these men is getting rich. If they're lucky, they'll earn about $20 each for this haul. But their reality is that this is the only work to be had. Deeper into the forest, you find villagers who say their life depends on the jungle around them. These villagers are traditional subsistence farmers. They watched as the illegal loggers cut their way through the forest but then no longer prepared to remain silent. With oil palm, they say they stand to lose everything.

MAN, (Translation): Mainly it is the social impact, when oil palms are planted, the company, people have to give land to the companies. Then some years later the people’s rights to that land are taken over by the company. So in the end the people have no land for farming and so on.

But they also know that without alternative financial incentives there will be little to stop trees being chopped down for oil palm to be planted.

MAN, (Translation): The people are from the forest, they are farmers, so of course they love the forest. If there’s deforestation or erosion, then the life of farmers will become difficult. That has made them think that preserving forests is self-preservation for us and for future generations.

It presents a dilemma that Indonesia will not be able to solve alone. How much do we destroy to save the planet?

Credits

Reporter/Camera

GINNY STEIN

Researcher

CATHY CAREY

Editor

WAYNE LOVE

Fixer

AGUSTINUS WIDHI

Translator

SARI SUDARSONO

Subtitling

ROBYN FALLICK

Palm Oil – Green Gold?