PALMOILMAGAZINE, JAKARTA – As the world’s largest palm oil producer, Indonesia has 16.8 million hectares of palm oil land. The industry contributes significantly to national exports, reaching US$ 37.76 billion in 2022 and US$ 29.54 billion in 2023, making it one of the main economic pillars. However, with growing export demand and the ambition of Indonesia’s Biodiesel Program, the expansion of palm oil plantations remains an important issue.
In his inauguration speech, President Prabowo Subianto expressed his commitment to food and energy self-sufficiency, one of which is by utilizing palm oil for biodiesel. The plan to develop B40 to B50 biodiesel is a priority, but this could encourage palm oil expansion that risks increasing deforestation and threatening food source land.
Although Indonesia already has regulations related to limiting palm oil expansion through Presidential Instruction (Inpres) No. 8/2019 on Palm Oil Moratorium, its implementation still faces challenges. The Palm Oil Moratorium Coalition states that this moratorium needs to be supported by a thorough economic and environmental analysis, including Environmental Support and Capacity (D3TLH) to balance economic interests and environmental sustainability.
Also Read: Indonesia Advances National Energy Sovereignty with Palm Oil Biofuel
In order to evaluate the effectiveness of this policy, the Palm Oil Moratorium Coalition held a discussion on the policy paper titled “The Urgency of Improving Palm Oil Governance through a Policy of Stopping the Granting of Licenses in the Perspective of Economics and Environmental Support and Capacity (D3TLH)”. This discussion aims to encourage the cessation of expansion permits for large industries and prioritize productivity intensification. The coalition hopes this can strengthen sustainable palm oil governance under President Prabowo-Gibran’s administration.
Lokahita researcher Jesika Taradini reminded that palm oil plantations in Sumatra, Kalimantan and Papua have reached the threshold of environmental capacity. “The recovery of environmental conditions on the three islands must be a priority rather than opening new palm oil plantations,” she said in an official statement received by Palmoilmagazine.com, Thursday (7/11/2024).
Also Read: Community Organizations Expose Agrarian Conflict and Human Rights Violations in Central Kalimantan
According to him, the expansion of new plantations will not have a significant impact on society or state revenues, except for the profits of large business actors.
From an economic point of view, Nailul Huda from the Center of Economics and Law Studies (CELIOS) said that the palm oil moratorium accompanied by the *replanting* program would have a positive economic impact. He estimated that this moratorium could contribute Rp28.2 trillion to the Gross Domestic Product (GDP) in 2045, and open 761 thousand new jobs. This figure, he said, was better than without the moratorium, which showed negative impacts on various aspects of the economy.
Similarly, Achmad Surambo from Sawit Watch emphasized the importance of the moratorium to stop uncontrolled expansion, ensure sustainable practices, and create fair and transparent governance. “Palm-based biodiesel has great potential to drive deforestation. This moratorium is an important step to minimize the negative impacts,” Surambo said.
On the other hand, Andi Muttaqien, Director of Satya Bumi, highlighted the weak implementation of regulations for palm oil governance. He said that the policy of bleaching oil palm land in forest areas even risked harming the state in terms of taxes. According to him, strict law enforcement and transparent data are very important to safeguard the interests of the environment and the state.
The European Union’s anti-deforestation regulation (EUDR) is also another urgent reason to implement a moratorium. Andi stated that this policy will improve Indonesia’s palm oil record in the international market by ensuring that palm oil is free from illegality and involves better due diligence.
With climate targets looming, Sadam Afian from Madani Berkelanjutan also supports the palm oil moratorium to maintain a better environment and achieve Indonesia’s climate targets. According to him, this policy must go hand in hand with sustainable governance for the welfare of the community.
Senior Campaigner Kaoem Telapak, Olvy Tumbelaka, emphasized that Indonesia needs to impose a stricter moratorium on palm oil permits. This moratorium, according to him, is important to protect biodiversity, meet international standards, and ensure the welfare of small farmers and local communities.
The Palm Moratorium Coalition hopes that the Prabowo-Gibran administration can take concrete steps to realize a more just, transparent, and sustainable palm oil governance. (P2)
