Measure if the Government is Serious in Palm Oil

Measure if the Government is Serious in Palm Oil

InfoSAWIT, JAKARTA - In the last years, the government of Indonesia decided that palm oil is the strategic commodity that could increase the people’s economy.

Palm oil is one biggest provider to the exchange of our country. It competes with the oil and gas sector. In 2018, referring to Coordinator Ministry in Economy, Republic of Indonesia, the exchange from palm oil reached US$ 21,4 billion or equal to Rp 300 billion.

The question remains, does palm oil contribute to increase the economy in the regions? A study of Yayasan Madani revealed that palm oil planting has something to do with the economy in the regions. It revealed too that there are five palm oil producers in Indonesia, they are, West Kalimantan, Riau, East Kalimantan, Central Kalimantan, and North Sumatera. The five provinces had the biggest palm oil plantings in 2011 – 2017.

The government of Indonesia through Vice President, Ma’ruf Amin, in the international palm oil conference in Bali in the end of 2019 claimed that palm oil planting could support the economy and develop the economic centers, such as, in North Sumatera, Riau, and Kalimantan. Ma’ruf Amin also said that many provinces in Indonesia have better economy because of palm oil.

But when Yayasan Madani started doing researches about palm oil contribution to the economic in the regions, it was found that there are different descriptions from the understanding for all these years.

When data of gross regional domestic product (GRDP) from five provinces is put together, every GRDP of each province is not equal to the regional economy. For instance, in 2011 – 2017 GRDP of plantation sector contributed to the total GRDP nationally could be stable about 13%.

But as a matter of fact, only Riau and East Kalimantan showed the increasing GRDP trend of the plantation and it was equal to the new palm oil planting.

North Sumatera, though the GRDP increased, it did tend to flat (not too significant). In the other two provinces – West Kalimantan and Central Kalimantan – the plantation showed the significant decreasing GRDP. (T2)

For more, please read InfoSAWIT, August 2020


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