Wednesday, 22 June 2011

Pay Attention to Farmers Oil Palm Plantation

Secretary General of Association of Indonesian Palm Oil Producers (GAPKI), Joko Supriyono, said that oil palm is currently the main commodity that contributes to national economy. Unfortunately, the process of becoming a main commodity contributing to national economy is going on naturally without government’s intervention, now it is  time for the government to interfere by promoting development of oil industry.

“If the government is unable to pay attention to large scale plantations, it should pay attention to farmers’plantations. And large scale plantations should not be burdened by many regional government regulations that makes investment climate less conducive. Export duty is ironic as Indonesia imports food with 0% import duty, while CPO export is imposed with 255 tax. This is unproductive”, he said.

Support to farmers’s plantations shall be given in the form of construction of road infrastructure. Long distance between farmer’s plantations to palm oil mills (PKS) and bad road condition causes difficulty In transportation of oil palm fresh fruit brunches  (TBS) from farmers’s plantation to palm oil mills.

Plantation revitalization is stagnant. The situation will continue if the government did not extend its assistance. Mechanism of credit for plantation revitalization programs is the same with normal business mechanism. If the requirement are met, the money is disbursed. Credit requirements could made lighter. Currently, banks will not provide credit without any security. Without government’s intervention, farmers will not able to access credit”, he said.

Concerning Indonesian Sustainable Palm Oil (ISPO) standard, Joko commented that this is a preliminary step of the government to have an attitude of being sustainable. ISPO will improve oil palm industry, but not in terms of a superior position as if everything will be clear if ISPO is already available. Because it is mandatory, the government can control every plantation company more effectively.

ISPO will become Indonesian Standard (SNI). Whether it will be internationally recognized or not, it is not yet known as the international world prefers to make its own standard. For example, ISO which was made by Europe had become a big business, it was no longer needed by the United States and Europe as it was less competitive, so it was no longer serve as standard. Indonesia will try to register ISPO in Europe and WTO since it is a state policy”, he said.

In a meeting between GAPKI and President SBY some time ago, the President was aware of the importance of the role of oil palm in national economy. The regulation that will be issued will provide more balance between environmental aspects and economic aspect.

The President also assured GAPKI that forest moratorium for natural forests and peatland will not hamper expansion of oil palm business. The President refused to be dictated by foreign countries. Joko expects that the President’s support could be realized in the form of ministerial policy. The Government already prepares a blueprint of Sumatera and Kalimantan economic corridors stating palm oil as the main commodity. 

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