Indonesia forest fires cost $15.7bn
16 December 2015
- From the section Business
Indonesia’s forest fires and subsequent haze pollution this year have cost the country “more than twice” the amount spent on reconstruction efforts after the 2004 Aceh tsunami.
In its quarterly report, the World Bank said the fires had cost some 221tn Indonesian rupiah ($15.72bn; £10.5bn).
Forest fires saw a thick haze blanket parts of South East Asia for months.
The fire and haze pollution have occurred for years, though 2015 has been particularly bad.
The World Bank said the cost of the fires this year amounted to 1.9% of Indonesia’s gross domestic product (GDP). It added that regional and global costs would be much higher.
Every year, Indonesia sees agricultural fires in Riau province in East Sumatra, as well as in South Sumatra and parts of Kalimantan on Indonesian Borneo. The fires are a result of annual slash-and-burn practices by companies clearing land for palm oil and pulp wood plantations.
“This vast economic and environmental crisis is repeated year after year, as a few hundred businesses and a few thousand farmers seek to profit from land and plantation speculation practices, while tens of millions of Indonesians suffer health costs and economic disruptions,” the World Bank said.
Action and convictions
On Thursday, Indonesia is expected to name the firms responsible for starting the fires.
The government has said it would revoke the licenses of firms and individuals found burning land and that those people caught would face up to 10 years in jail.
But local farmers have said convictions are unlikely.
Furthermore, President Joko Widodo recently told the BBC that it might take at least three years before the situation is under control.
The World Bank said that by October this year, eight Indonesian provinces had burned more than 100,000 hectares each.
“Now is the time for Indonesia to address the underlying drivers of man-made fires, enforce laws and revise policies in order to reduce the risk of these economic disasters from recurring,” the bank said.
This post was written by FSB News