Sat, 04 Dec 2010

Nusa Dua, Bali (ANTARA News) - The Indonesian government on Thursday lodged a protest with the World Bank against the draft framework for engagement in palm oil which it said will harm the development of palm oil industry in the country.

"I, on behalf of the Indonesian government, have just written to the World Bank and the IFC (the World Bank`s private investment arm) to express our stand on the imbalanced draft," Deputy Trade Minister Mahendra Siregar said on the sidelines of Indonesia Palm Oil Conference and Price Outlook 2010 here.

He said the draft called the World Bank Group`s Framework for Engagement in the Palm Oil only puts emphasis on the concept of sustainable environment without considering economic aspects and social welfare, as conditions for the World Bank loans for the development of palm oil industry.

The World Bank has reviewed its strategy of extending loans to palm oil industry for allegedly causing damage to forests and biodiversity and producing high carbon emissions.

"I see it (the draft framework) appears to be imbalanced," he said.

As an international financial institution, the World Bank should encourage its members, including Indonesia to be able to meet its loan requirements rather than causing difficulties to them, he said.

He said the national palm industry is currently stronger than in 10 years ago thereby it does not need direct assistance from the World Bank and the IFC.

"But since the World Bank is an international institute its view (on palm oil industry) will serve as reference for the others," he said.

He said the draft framework, if endorsed, should boost the growth of its members instead of impeding it.(*)