JAKARTA – The Indonesian government has been committed to prioritizing the empowerment of oil palm smallholders on the implementation of sustainability principles, so that they are more acceptable and more competitive at the international market of vegetable oils.
The economic coordinating ministry’s Deputy in charge of Foods and Agribusiness Coordination, Musdhalifah Machmud said the government is confident that the development of agribusiness sector, including the palm oil, and the empowerment of oil palm smallholders will bring positive impacts to the national economy. “The government has applied the regulation on the system of Indonesia Sustainable Palm Oil (ISPO) certification. It has been continually pushing the oil palm farmers to implement the principles of sustainability,” she said.
The Oil Palm Plantation Fund Management Board’s (BPDPKS) President Director Eddy Abdurrahman said that the national palm oil industry, from upstream to downstream, has an important role in the national development program. As one of the leading industries in the Indonesian economy, the palm oil industry has employed directly 4.2 million workers and indirectly 12 million workers.
“It contributes 3.5% to Indonesia’s total gross domestic products (GDP), and 13.5% to Indonesia’s total foreign exchange earnings from its total non-oil-gas exports. The palm oil industry have also helped Indonesia in strengthening its national energy resilience through the production of oil palm-based biodiesel. Besides its green benefits, the biodiesel production helped Indonesia in reducing the import of diesel fuel and saved foreign exchange at US$8 billion per year,” she said.
Based on the government’s data, almost half of Indonesia’s oil palm plantation areas are owned by smallholders. The government has implemented a number of programs to improve the performance of the smallholders in cultivating their plantations. One of them is the program of replanting, through which the government has pushed the smallholders to apply the sustainability and the good agriculture practices.
The Indonesian Palm Oil Association’s (GAPKI) Communication Division Head Tofan Mahdi said that there are three challenges facing the national palm oil industry. “The three challenges are sustainability performance, improvement of their supply chain and competitiveness, and ISPO certification,” Tofan said during a public discussion organized by Infosawit in Jakarta on Thursday, 10 November 2022.
He said that helping the smallholders in dealing with the challenges will certainly improve their sustainable plantation performances, which will in turn improve their public welfare. “The ISPO certification will make their product more acceptable at the global market. The palm oil industry will be continually monitored to ensure that it will stay the backbone our national economy,” he said.
He added that especially in the market of European Union (EU), the sustainability is the main aspect considered by consumers. “The Indonesian government has been committed to focusing on sustainability in developing the palm oil industry,” he concluded. (*)
Source: Investor Daily
