Thursday 02 september 2021
In 2018, the Indonesian government issued a Palm Oil Moratorium. The moratorium is ending September 2021. Sawit Watch, IUCN NL partner in Indonesia and the lead CSO in Indonesia concerning palm oil issues, in collaboration with other Indonesian CSOs is calling upon the Indonesian government to extend the current moratorium. This call is substantiated by an assessment of the strategic opportunities gained from policy extension and the consequences of policy termination. According to the CSOs, extending the current moratorium provides both environmental benefits as well as socio-economic opportunities.
Header photo: palm oil plantation © Sawit Watch
Increased demand for sustainably sourced oil
Sustainable certified palm oil covers 19% of the total global Crude Palm Oil (CPO) demand and shows an increasing trend for example through EU company and government policies. Indonesia has the potential to absorb future international market’s demand for sustainable CPO if the sector is transformed conform the objectives of the moratorium.
Land conflicts should be resolved
Almost half of the 22.2 million hectares under oil palm licenses is overlapping with other concessions or with forest areas. About 25% overlaps with forest areas inhabited and used by Indigenous Peoples and Local Communities (IPLC). License overlaps are detrimental not only to IPLCs, but to palm oil companies as well. A study shows that costs borne by companies from agrarian conflicts can reach up to USD 9 million.
Smallholder productivity should be increased
The productivity of smallholders’ plantations is still very low – approximately 12 tons/ha/yr., 30% of the target of 36 tons/ha/yr. – and far below major state-owned or private plantations. The government has targeted all smallholders to be ISPO certified by 2025. Currently however, smallholders ISPO certification rate is only 0.21% – 12,270 ha of the total 5,807 million ha smallholders’ plantations. Unresolved land legality issues are the primary reason for the low ISPO certification achievement.
Climate commitments need to be fulfilled
Andi Inda Fatinaware, Executive Director of Sawit Watch, explains: ‘Indonesia has the ambition to reduce emissions in the forestry sector with 17.2% to 38% by 2030. The moratorium provides the opportunity to contribute to Indonesia’s climate commitments. Currently there is about 6.2 million ha of peatlands located inside palm oil concessions. Restoring 3.8 million ha peat land to its natural functions can avoid emissions from fires and land conversion by 11.5 million tons carbon per year.’ She also explained that wild fires in Indonesia – often purposely started for expansion of palm oil plantations – are seriously contributing to global warming. Estimates show that in 2015 the Indonesian CO2 emissions from biomass burning were between the 2013 fossil fuel CO2 emissions in Japan and India.
Provincial governments are to provide data and information from the district to the National Palm Oil Moratorium Working Team and some District Heads/Mayors and Provincial Governments have a strong commitment to implement the Moratorium. However, they are facing a lack of policies on operational and technical guidelines (road maps) and the absence of regional budgets (central assistance) for the implementation of the Presidential Instruction.
Another obstacle in achieving the objectives of the Moratorium is the Omnibus Law (2020) which encourages the expansion of palm oil plantations by loosening social and environmental criteria, especially when branded as a National Strategic Project in which local governments have a limited voice. For example, the biodiesel programme and the plan to build Energy Estates in Papua (12 million ha) – require expansion of the area for oil palm plantations.
The CSOs recommend to focus on a number of measures to extend and improve the implementation of the moratorium. ‘We strongly advise to turn the moratorium into a stronger and legally binding regulation’, says Andi Inda Fatinaware. ‘We also advocate for more information on the implementation of the moratorium to the public and clear targets on for example increased productivity and protection of natural forest cover in plantation areas as High Conservation Value (HCV) or registered forest area.’ She also stresses that provinces and districts need more technical support and budget to implement the moratorium instructions effectively. Regional government authorities who have reviewed permits and taken corrective actions need support to ensure these actions have a real impact on indigenous peoples and communities.
Call to action
On September the 8th during the World Conservation Congress, Sawit Watch in collaboration with IUCN NL presented what the role of the moratorium is among other international policy measures, and why its extension is important for sustainable palm oil and good land use governance. The CSOs called upon national and international organizations and business to support them and pleaded for an extension of the moratorium, and issued a letter to the Indonesian government than can be signed.