The biggest challenges in establishing timber plantations in Indonesia concern a range of social aspects, in particular those dealing with people living inside concessions and in the areas surrounding plantations. CIFOR’s research shows that a sustainable supply of timber may be achievable through partnership schemes that encourage companies and local communities to work together in sharing both the benefits and risks of investing in plantations.

In 1997, a major financial crisis struct Asia. In the wake of that crisis, the International Monetary Fund and the World Bank provided large loans to the Indonesian government in return for their commitment to implement policy reforms intended to stabilize the economy and rekindle growth. Those reforms included various measures explicitly designed to improve forest management, most of which focused on forest concessions run by large Indonesian conglomerates.