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NEWS UPDATES 17 July 2010

Palm oil industry and poverty reduction

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Alan Oxley, Arlington Writing in the International Herald Tribune late last year, Tun Dr. Lim Yeng Kaik, a former senior Malaysian Cabinet minister, characterized the campaign of Western environmental activists to restrict the palm oil industry as the environmental version of the “White Man’s Burden”. The aim was to impose western values on colonial peoples. He coined the term the Green Man’s burden. The Indonesian palm oil industry showed similar resentment when Nestle and Unilever bowed to pressure several months ago from Greenpeace to restrict use of palm oil and paper products from Indonesia. Small holders, representing the 20 million people dependent on the industry, protested in Jakarta and industry leaders threatened to lead boycotts of Unilever products, according to the Jakarta Post.

If Greenpeace got the point, it is ignoring it. This week it released in Amsterdam a scurrilous report, Pulping the Planet, which purported to attack one of Indonesia’s largest and the most successful resources companies, Sinar Mas.

The company is just a proxy target. Greenpeace is taking aim at the path Indonesia has taken to raise living standards and reduce poverty. The Greenpeace message is “do it our way, or not at all”. If the cost is poverty, so be it.

In the same way Europe transformed forest land as it industrialized and developed, so too are Indonesia and other developing countries. At least Greenpeace is consistent in one respect. It would have also opposed the industrialization of the Ruhr in Germany and the north of England. Its ideal world is an undisturbed environment, even if life spans are short and living standards low.

Greenpeace’s complaint is the very success Indonesia’s major resources companies have had in building prosperity and jobs out of one of Indonesia’s greatest natural resources — its rich soils and climate. It contends too much forest is being converted. Around 25 percent of the country of which around half is forested is reserved for forest. Is that not enough? It is far more than the average reserved in Europe.

Greenpeace claims stopping any further conversion will save endangered species. That will not: only deliberate conservation programs save species; and they are well supported by the very companies Greenpeace is seeking to demonize.

The Greenpeace strategy is to bring external pressure to bear on the Indonesian government to go further than it has committed in its agreement with the Norwegian government to adopt a broad program of sustainable forestry.

That agreement contains a commitment to a temporary moratorium on further conversion of forest and peat land for expansion of palm oil and plantation forestry. The Greenpeace demand in the report attacking Sinar Mas is clear — make the moratorium permanent. The commitment must be temporary for two reasons. First, the facts of the situation are not clear. A lot of land has been cleared but not taken up with new plantations. Why not? One reason is confusion over land titles and permits issued by different government authorities which overlap.

As well, Indonesia does not have a proper inventory of what generates greenhouse gas emissions. Strategies to meet the government commitment to reduce emissions cannot be developed until proper data is acquired.

The second reason is that the policy framework in Indonesia governing land use and plantations needs fine tuning, not overturning. It enables continuing development, sets aside land for natural forest and supports conservation.

As the forestry minister has observed, Indonesia cannot afford a permanent moratorium. “Where will the jobs come from?” he asked. The President wants annual economic growth climb to 7 percent. That won’t happen if growth in the agro-forestry industries is halted.

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