PALMOILMAGAZINE, JAKARTA – The Roundtable on Sustainable Palm Oil (RSPO) and the Ministry of Cooperatives and Small and Medium Enterprises (Kemenkop UKM) of the Republic of Indonesia have signed a Memorandum of Understanding (MOU) to accelerate the progress of Indonesian oil palm smallholders to become more sustainable while opening up opportunities for better livelihoods and development. public.
This Memorandum of Understanding will be the basis for both parties to develop and implement capacity building initiatives and access to funding for Independent Smallholder Cooperatives (ISH) to accelerate sustainable oil palm cultivation in Indonesia.
The Minister of Cooperatives and Small and Medium Enterprises of the Republic of Indonesia, Teten Masduki, said the MOU aims to develop and empower independent smallholder cooperatives.
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Moreover, Indonesia is the largest palm oil producing country in the world with a land area of 14.59 million hectares. It is important for oil palm smallholders to join cooperatives to ensure they have stronger bargaining power and are integrated throughout the palm oil value chain to achieve economies of scale.
“This MOU is a positive step to accelerate the development of sustainable palm oil among independent smallholders in Indonesia,” said Teten, in his statement to Palmoilmagazine.com.
Teten further said, where the scope of the MOU will be to exchange data and transfer knowledge in order to build the capacity of Indonesian independent smallholder cooperatives. The ministry will provide key data on independent smallholder cooperatives including their mapping, distribution, location and number of smallholders involved. The MoU will help increase certification among the ISH group by providing access to funding through the RSPO Smallholder Support Fund to help cover certification costs and other costly training required to implement best agricultural practices.
RSPO Chief Executive Officer, Joseph D’Cruz, observed that the emergence of new regulations globally is pushing the palm oil sector to demonstrate higher levels of sustainability throughout the value chain. While positive, this regulation can put smallholders at risk of being removed from the value chain if they cannot meet the stringent and costly traceability requirements imposed by this regulation.
“With more than 2.6 million smallholders operating in Indonesia, many of whom are already practicing sustainable cultivation, it is the industry’s responsibility to ensure that this group is not left behind. This MoU aims to build a more resilient and inclusive palm oil sector in Indonesia by increasing the capacity of smallholders,” said D’Cruz.
The MoU will be effective for three years with annual evaluation and accountability review. During this period, the two entities will collaborate to enable more synergies and coordination of key tasks and programs to accelerate the uptake of cooperative-based sustainable palm oil in Indonesia. (T2)
