President Jokowi has issued a regulation on the sustainable management of the oil palm industry. Ironically, it does not include critical elements such as enforcement of human rights or traceable supply chain.
SOW rice but reap weeds. This old Indonesian saying is appropriate to describe Presidential Regulation No. 44/2020 on the certification system for sustainable Indonesian oil palm plantations.
This regulation should make people happy because it raises the level of the oil palm industry from being regulated by the ministry of agriculture to being a matter for the president. But it seems that this promotion is simply a sweetener at a time of onslaught from international markets on our oil palm industry, which is frustrated in the face of accusations of responsibility for deforestation and violations of human rights.
Presidential Regulation No. 44 does not address these two fundamental and crucial issues. All that is included in the regulation are minor modifications to the regulation from the ministry of agriculture concerning seven areas, namely certification, institutional matters, acceptability, competitiveness, the role of the public, development and oversight, and sanctions.
The main problem with oil palm plantations in Indonesia is that they damage forests. Of 16.3 million hectares of oil palms registered with the agriculture ministry, around 3.5 million hectares are located in forests. This means that these plantations were established by illegally clearing forests, or as a result of the confusion in the issuing of permits between regional governments and the forestry ministry. Deforestation and degradation mean improper conversion of forests, and are a cause of global warming.
In the last five years, nations that participated in the Climate Conference and signed up to the 2015 Paris Agreement have come to an understanding that any policies they make must be based on reducing emissions, absorbing carbon and preventing global warming. The oil palm plantations sector is often accused of being responsible for deforestation because of its monocultural nature, the fact that plantations are established on illegally cleared forests and because of the overlap with lands belonging to indigenous people, which in the end leads to social conflict.
Ignoring deforestation and human rights will only worsen the competitiveness of Indonesia’s battered palm oil industry. At a time of strident warnings about the danger of global warming, policies that are not environmentally friendly will make the palm oil industry even less competitive and less efficient. The eventual result will be that farmers on the ground will not benefit from the multiplier effect or the ‘drip-down economy’ impact from the oil palm policy.
We need the government to ensure that the economic and social rules have an impartial referee. Without fixed standards and regulations for the palm oil supply chain, every industry player will make its own rules because it wants to be competitive in the global market, and this will lead to imbalance in the industry.
The government should first deal with the problem in the upstream oil palm industry, namely the overlap between oil palm plantation permits and forests. Without improvements to the way that oil palm plantations are managed on the ground, the industry will continue to face negative campaigning as the cause of deforestation and global warming as well as disastrous social conflict. Experts have made a number of suggestions as to how palm oil management can be made more environmentally friendly.
For companies whose plantations are in forests, the solution must be through the courts. Meanwhile, for trees managed by farmers, the answer is agroforestry. With these two approaches—as well as the seven matters regulated under the presidential regulation—the competitiveness of our oil palm industry will improve because it will be in line with the demands of the market, which wants to see environmentally friendly processing and support for human rights. It would be prudent if the president were prepared to revise Presidential Regulation No. 44.