PALMOILMAGAZINE, JAKARTA — As the country commemorates International Workers’ Day, a somber message emerged from one of Indonesia’s most vital industries—palm oil, which contributes approximately IDR 600 trillion annually to the national economy. The concern was not over wages or productivity, but something far more fundamental: legal certainty.
Sumarjono Saragih, Head of Human Resources at the Indonesian Palm Oil Association (GAPKI) and founder of Worker Initiatives for Sustainable Palm Oil (WISPO), used the May Day 2025 forum hosted by the Sarbumusi Confederation not just to celebrate the industry’s achievements but to issue a warning.
“Have the previous speakers addressed the reality facing the palm oil sector? We are not just under pressure—we’re crying out,” he said during the panel discussion titled “Economy Squeezes, Workers Suffer.” He likened the current situation to a massive aircraft caught in severe turbulence, struggling to regain stability.
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At the heart of the crisis lies legal ambiguity—especially concerning land classification. An estimated 3 million hectares of palm oil plantations are currently entangled in legal limbo due to being retroactively designated as forest areas, despite long-standing official permits and decades of cultivation by farmers and corporations alike.
“If these lands are now classified as forest areas, what have the plantation owners been doing all these years? Were they just being ignored?” he questioned.
Government-installed signage marking these lands as “seized by the state” has only intensified the confusion. Should these 3 million hectares be permanently reclassified, they would become ineligible for harvesting, commercial trade, and certification as sustainable products. The implications are massive—potentially slashing national crude palm oil (CPO) output by 9 million tons, or roughly 18% of Indonesia’s total production.
Adding to the irony, Sumarjono highlighted the recent efforts by GAPKI in collaboration with 10 major labor unions, including Sarbumusi, to build a robust bipartite platform to protect workers’ rights in the palm oil sector. These efforts have even gained recognition from the International Labour Organization (ILO) as a model for improving labor compliance in a complex industry.
“While we work hard to improve labor welfare, we are suddenly faced with a policy that threatens the very land where these workers earn their livelihoods,” he said.
Using the widely accepted ratio of one worker per hectare of oil palm, the potential loss of 3 million hectares could translate to 3 million lost jobs—an economic blow with particularly severe consequences for regions where palm oil is the primary, if not the sole, source of income. (P2)
