Indonesia, Brazil say to cooperate on biofuel

The leaders of Indonesia and Brazil agreed on Saturday that their developing nations, home to much of the world's remaining tropical forest, would cooperate on biofuels after talks covering climate change and food.

The two nations signed an agreement for Indonesia to send experts to Brazil to study its biofuel developments, said Indonesian President Susilo Bambang Yudhoyono.

"Brazil has been successful developing bioethanol and of course Indonesia can learn from the research and development," Yudhoyono told a news conference after talks with Brazilian President Luiz Inacio Lula da Silva.

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Brazil, a pioneer of mass ethanol usage in cars, has been mixing the sugar cane-based fuel with gasoline for decades, as well as running a vast fleet of vehicles on pure ethanol.

Indonesia, the world's biggest palm oil producer, has also been pushing biofuels to cut the use of costly petroleum products, and aims to make mandatory the use of a 2.5 percent blend of biodiesel by September.

The biofuel sector has come under attack from green groups for accelerating the destruction of forests, while some analysts blame it for contributing to soaring world food prices by diverting land that could be used for food crops.

The Brazilian president defended the biofuel sector and blamed international speculators for contributing to the current high food and oil prices.

"First at all, it is not ethanol or bio-fuel production that are responsible for the rise of food prices," said Lula, who added that the thirst for energy from fast-growing China was also not the only reason oil prices had soared.

The world's food problems would also be helped by reaching an agreement on the Doha round of World Trade talks that opened market access for agricultural products, Lula said.

Yudhoyono also said it was vital for richer nations to open up their agricultural markets to help reduce poverty.

The Brazilian president also said that richer countries should do more to cut greenhouse gas emissions blamed for global warming.

Indonesia has been pushing for richer nations to pay poorer nations to retain their tropical forests, which are an enormous store of carbon and act like sponges to soak up greenhouse gases.

"No one wants to preserve our forests more than we ourselves but the most polluting countries they must start to discuss more seriously how to cut greenhouse gas emissions," said Lula. (Writing by Ed Davies; Editing by Catherine Evans)

Sourced from the Reuters InterActive Carbon Markets Community - a free, gated online network for carbon market and climate policy professionals.

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