PALMOILMAGAZINE, JAKARTA – Coordinating Minister for Economic Affairs, Airlangga Hartarto, announced that new policies would be introduced to support the sustainable development of the palm oil industry. One key initiative is the upcoming Presidential Regulation on the National Strategy and Action Plan for Sustainable Palm Oil (Strategi dan Aksi Nasional Kelapa Sawit Berkelanjutan, SANAS KSB) for 2025-2029.
This regulation aims to strengthen governance in the palm oil sector, making it more environmentally sustainable.
The palm oil industry plays a crucial role in Indonesia’s economy, contributing significantly to the global vegetable oil trade, accounting for 42% of the world’s total vegetable oil supply and 62% of the crude palm oil (CPO) trade. The sector also contributes US$ 40 billion, or 14.2%, of Indonesia’s total non-oil and gas exports.
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Airlangga emphasized the industry’s positive impact on employment. “The palm oil industry directly employs 2.4 million independent smallholders and provides 16 million jobs both directly and indirectly,” he stated at the 2024 Policy Brief Seminar of PKN Tingkat I Angkatan LX, organized by the National Institute of Public Administration (LAN) in Jakarta on Wednesday, October 2.
The plantation sector, including palm oil, experienced solid growth in the second quarter of 2024, reaching 5.05%.
Airlangga said that Palm Oil Plantation Fund Management Agency (PO PFMA) that was established in 2015, played significant roles as the strategic agency to formulate policies from the upstream to downstream sectors. PO PFMA also facilitated biodiesel mandatory program that successfully reduced green-house gas up to 32,6 million tons of CO2 in 2023 through B35 program. In 2024, the target to distribute B35 would be 13,4 million kiloliters and the government still prepares B40 implementation in 2025 with the distribution target up to 16,08 million kiloliters and the potential saved revenue about Rp 158,86 trillion.
“Indonesia is committed to minimize diesel import by encouraging biofuel production in this country from B35 to be B40 and even B100 in the future,” Airlangga said, as Palmoilmagazine.com quoted, Friday (4/10/2024).
The government still develops palm kernel expeller (PKE) as the animals’ food and material for bioethanol production. It is hoped to ba acknowledged as sustainable aviation fuel by International Civil Aviation Organization (ICAO) through carbon offsetting and reduction scheme for international aviation (CORSIA).
To face the global scale challenges, such as, European Union Deforestation-free Regulation (EUDR) that would be implemented by the late of 2024, the Government of Indonesia developed national data and sustainable commodities information dashboard. It would cover some commodities, such as, palm oil, cocoa, rubber, coffee, and wood that would get the impacts from EUDR.
“EUDR obliges the legal and original verification of plantation areas through cultivation documents published by Ministry of Agriculture,” he said.
It was also attended by Deputy in Food and Agribusiness Coordination, Dida Gardera; Deputy in Business Development Coordination Ministry of Enterprises, Elen Setiadi; Head in duty of LAN Muhammad Taufiq; and the participants of PKN Tingkat I Angkatan LX 2024. (P2)
