Govt to proceed with oil palm project

Muninggar Sri Saraswati and Tb. Arie Rukmantara, The Jakarta Post, Jakarta

The government is likely to go on with its plan to use over 1 million hectares of tropical forests for oil palm plantations in West and East Kalimantan despite opposition from environmental groups.

Minister of Forestry Malam Sambat Kaban said that the establishment of the oil plantations in Kalimantan, which are expected to be the largest in the world, had very significant political and economical value for the country.

"Most of the (planned plantation) area would be located near the border (with Malaysia), which has been neglected in the past," he told The Jakarta Post over the weekend.

The government expects the establishment of the plantations to create some 100,000 new jobs.

The establishment of the oil plantations in the border areas is seen as a way to strengthen the territory of Indonesia as well as to improve the economic welfare of the people there, most of whom are living in poverty, Kaban said.

The Ministry of Forestry is currently finalizing a report on the controversial plan, he said.

"We expect to finish it this month. A presidential decree will be issued for the purpose," Kaban said.

A number of environmental groups have warned that the establishment of the oil palm plantations, would lead to environmental, social and economic losses.

Funded by Chinese investors, the plantations will be located in an area known as the Heart of Borneo, which is the only remaining place in Southeast Asia where forests can be conserved on a massive scale.

The Heart of Borneo is known as one of the richest areas in terms of biodiversity in the world and one of only two places on earth where endangered orangutans, pygmy elephants and rhinos exist.

Fourteen of 20 major rivers on the island originate from the region, making it the source of water for its inhabitants.

Citing a study, some environmentalists also argued that the topographical condition of most parts of the Heart of Borneo was not suitable for oil palm plantations.

Greenomics Indonesia also warned that the clearing of the rain forests for plantations would damage the local economy. It estimates that the plan, which would cost some US$8 billion, carries some Rp 27 trillion ($2.7 billion) in potential losses annually due to environmental degradation.

However, Kaban dismissed the warning, saying that the government would maintain the environment.

"We would not allocate protected forests for the plantation. It would probably be less than 1 million hectares," he asserted, adding that the government would require the plantation companies to prepare measures to protect the environment.

Indonesia currently produces 36 percent of the world's palm oil.

Meanwhile, the World Wide Fund for Nature (WWF) -- which also opposes the oil palm project on part of Borneo island -- said it would hold a two-day 3rd Round Table on Sustainable Palm Oil (RSPO) in Singapore starting Nov. 22 for the purpose of formulating principles and criteria for an environmentally friendly palm oil industry.

An RSPO was first held in 2003 by WWF and oil palm plantation firms, producers and buyers to discuss definitions for responsible conduct by oil palm plantations.

"We expect the conference to formulate criteria for an environmentally friendly oil palm plantation industry," said Fitrian Ardiansyah, WWF Indonesia Program Coordinator for Forest Restoration and Threat Mitigation.

He said the criteria included a requirement for oil palm plantations not to threaten the existence of conservation forests.

"Plantation firms must not establish plantations in highly protected areas, must not cause forest fires and pollution, and must not spark social unrest among local people," Fitrian said.