'Growing demand for palm oil threatens RI forests'
'Growing demand for palm oil threatens RI forests'
Deutsche Presse-Agentur, Jakarta
A surge in world demand for palm oil bodes ill for Indonesia's fast-disappearing forests unless international banks and importing countries insist on sound practices for the country's plantations, the World Wildlife Fund (WWF) warned on Wednesday.
The WWF, in a report titled "Oil Palm Plantations and Deforestation in Indonesia," predicted that global demand for palm oil will increase from 22.5 million tons per year currently to 40 million tons in 2020.
To satisfy the demand, producer countries will need to establish 6 million hectares of new palm oil plantations by 2020, with half of these predicted to be in Indonesia, it said.
"Oil palm plantations have had a destructive effect on Indonesia's threatened natural forests," said Chris Elliott, director of WWF's Forests for Life Program.
"However, if financial institutions that fund this industry - and in particular the European ones - would open their eyes to the damage being done, it would be perfectly possible to find and fund palm oil plantations that do not destroy natural forests," he added.
Indonesian oil palm plantations have grown from some 600,000 hectares in 1985 to more than 3 million hectares in 2000, leading to dramatic habitat reduction for endangered species such as orang-utans and Sumatran elephants.
Instead of putting palm oil plantations on widely available degraded lands, many have been set up in the country's natural forests, which have been disappearing at an annual rate of 2 million hectares per year since 1997.
The fast expansion of the palm oil sector has been financed to a large extent by European, North American and East Asian financial institutions that rarely try to improve the social and environmental practices of their clients, said the WWF.
"It is vital that investors, traders and retailers move towards better practices," Elliott said.
He noted that four Dutch banks have adopted a pioneering responsibility policy in their financial services to the Indonesian palm oil sector and Swiss retail company Migros had also adopted sustainability criteria for its sourcing of palm oil.
The report noted that India, China and Pakistan are the world's largest importers of palm oil, while the European Union has a share of 17 percent of the global palm oil market.