JAKARTA – The deadline for oil palm companies and smallholders to get legal clarity and certainty for their problematic plantations has passed for more than one month. But seemingly, their tug-of-war over the legality of the plantations with the government, especially with the ministry of environment and forestry (KLHK), is persisting with no signs of settling it soon.
Addressing the national conference of the Association of Indonesian Oil Palm Smallholders (Apkasindo) recently in Jakarta, the ministry of environment and forestry’s (KLHK) Forest Area Use Director Muhammad Said stated again that around 3.3 million hectares of oil palm plantations are still included in the forest areas.
“Of the total 16.38 million Ha of Indonesia’s oil palm plantation areas, around 3.3 million hectares are located in the forest areas based on forestry map. This is a problem that we’re trying to resolve,” he told the participants of the Apkasindo meeting in Jakarta on Thursday (7/12).
According to him, the palm plantations are located in three types of forests, namely conservation forest, protected forest, and production forest.
But the palm industry players stated that data provided by the KLHK regarding the palm plantations located in forest areas is not accurate. The Indonesian Palm Oil Association (GAPKI) Chairman Eddy Martono repeated again his previous statement that actually the 3.3 million hectares (Ha) of palm plantations claimed by the government located in forest areas are not all located in the forest areas.
“It’s only all indicated so. But surely, not all of the 3.3 million Ha located in the forest areas. All will be clarified later,” Eddy told CNBC Indonesia on Friday (8/12).
He cited the example of growers who had been already legally excluded from forest areas, but they are still included into the indicative forest map. “They’ve been delisted from forest areas and got their cultivation rights (HGU). But why they’re still included in the indicative forest map. It’s because in the indicative map the smallholders’ ownership certificates during the previous implementation of PIR-Trans program were included in the forest areas,” he said.
Eddy said that palm industry players hope the palm oil task force (Satgas Sawit), which was established by President Joko Widodo (Jokowi) to improve the governance in Indonesian palm oil industry, will resolve the legal problem of the plantation areas claimed to have encroached the forests. The Satgas Sawit had summoned a number of companies to clarify the legal status of their plantations which are claimed to be overlapping with forest areas.
“Satgas Sawit has summoned a number of palm companies. Hopefully, Satgas will help accelerate the process of resolving the problem,” said Eddy.
According to Eddy, GAPKI had filed applications from 380 owners of 700,000 hectares of palm plantations to the KLHK to get forest releasing permits. “380 member companies of GAPKI have filed proposals to KLHK to get forest releasing permits for their 700,000 hectares of palm plantations suspected to encroach forests,” he said during the Indonesian Palm Oil Conference in Nusa Dua, Bali, early in November 2023.
He said that not all of the total 700.000 hectares have HGU. “Some of them have HGU, some are still in the process of getting HGU, while the others only have plantation business licenses (IUP),” he said.
According to Eddy, the main issue right now is concerned with the fact that the licenses given by the ministry of agrarian and spatial planning/national land agency (ATR/BPN) are not in accordance with those given by KLHK. “ATR/BPN claims that their licensing products in the forms of HGU are valid. But conversely, KLHK claims their palm plantation areas are not valid due to their location in forest areas,” he said.
Actually, the government through the KLHK and Satgas Sawit, has stated that they are in a process of resolving the problematic plantation areas based on the Law No.11/2020 (Omnibus Law) on Job creation, especially its article 110 A and article 110 B.
The solution for the problematic plantation areas will be based on the law’s two article stipulations. Its article 110A stipulates the oil palm plantations already cultivated in forest areas with business licenses, while its article 110B stipulates those cultivated in forest areas without business licenses.
Eddy said that palm business players hope there will be soon a final solution from Satgas Sawit regarding their plantation areas which are claimed to encroach forest areas. “We from GAPKI file our proposal for forest releasing permit, despite already having HGU. But we’re still waiting for a solution,” he said.
Based on the two articles, all palm growers, companies and smallholders, will have to pay fines to the government for encroaching into the forest areas. But the difference is that the plantations areas that have already had their HGU will be allowed to continue their plantation cultivation based on their license, while those with no HGU are only allowed to continue cultivation for just one current cycle and then return their plantation areas to the KLHK which will then reforest the areas.
Apparently, paying the fines will be no big problem for companies, as long as they secure the legal clarity and certainty of their plantations. But it is not the case for smallholders who see it as burdensome.
The Association of Indonesian Oil Palm Smallholders (Apkasindo) Chairman Gulat Manurung said that smallholders will not be able to pay the fines if their plantations are categorized on either article 110A or 110B. Around 5.85% of the total 3.3 million hectares of plantations claimed in forest areas are owned by smallholders.
But Said of the KLHK has admitted that they have not yet had accurate data on the smallholders’ 6.74 million hectares plantations, which account for 42% of Indonesia’s total 16.38 million hectares of oil palm plantation areas. “Currently, we don’t have accurate data on the smallholders’ plantations. We still don’t know exactly how much of the smallholders’ plantations overlapping with the forests. We haven’t yet got the data. But we have to find a solution for the problematic plantations,” he asserted.
Gulat said that if KLHK proceeds with its plan to return the plantations into forests and require the smallholders to pay the fines, then such solution will risk reducing Indonesia’s palm oil production by up to 10 million tons per year. “As a result, we’ll suffer from a financial loss of Rp125 – Rp145 trillion per year in the forms of taxes, export levy and export tariff. Even, it risks triggering social conflicts in palm producing areas,” he said. Benget Besalicto