The Palm Oil Havoc in Indonesia

Palm oil is the most used vegetable oil in the world. According to the most recent FAO update, 71 million tons of oil palm were produced in 2018. However, the conventional system of oil palm production is responsible for significant damage to the environment and local communities. And Indonesia, the world’s largest oil palm producer, is also one of the most affected, with its palm oil palm plantations causing deforestation, fires, air and water pollution, and loss of animals and plants. But we don’t have to look at it as a problem restricted only to nature.

Environmental deterioration has meant a disruption to the life of entire communities living around that damaged ecosystem, especially Indigenous communities. There is an urgency to have stronger environmental protection and transition to sustainable oil palm management, through the recognition that behind the impacts on the environment are the inevitable impacts on people’s lives.

DISRUPTION OF ENVIRONMENT AND INDIGENOUS COMMUNITIES

The environmental impacts of oil palm plantations in Indonesia are significant. Deforestation is the largest effect of plantation expansion, with huge environmental implications. Not only does it account for a big part of GHG emissions, it also results in altering the overall balance of nature, with loss of plants and animal species living in the forest, and air pollution from the burning of trees. Another concerning consequence is river pollution, caused by oil palm mills and the pesticides, herbicides, and fertilizers that flow into rivers close to the plantations.

The environmental degradation dramatically impacts Indigenous communities living in the expansion areas, especially with concern to health, livelihoods, and socio-cultural balance. For Indigenous communities, livelihood depends primarily on nature, through traditional subsistence activities such as agriculture, fishing, and gathering. And when nature is destroyed life is destroyed. Deforestation and land expropriation also result in the loss of resources that are fundamental for monetary and non-monetary gain. Lost resources include fruit and vegetables, medicinal plants, and firewood. Families who lose their income from forest products and from the land they have to sell, struggle for daily survival and to pay for their children’s education.

In an interview with Human Rights Watch, a 38-year-old woman with her child describes this situation: “My daughter attends high school in Jagoi and had to drop out … because I have no money. […] I had a kiosk and my husband would go to the forest, cut wood, and sell when there was a big expense like school needs. Now there is no forest.” People have no access to drinking water due to the poor water quality of polluted rivers. By killing marine life, river pollution also deteriorates small-scale fisheries, which catch fish that is consumed locally.

A Human Rights Watch report investigating the impacts of oil plantations on Indigenous communities living in North Barito has also raised concerns about food security. In a context where daily diets consist of rice, fish, and forest resources, and where additional revenue comes from selling non-timber forest resources, losing the ability to have self-providing food and the money to buy it cause these communities to lose the ability to feed themselves and their families.

In the words of Paulina, a 37-year-old woman from Semunying Bongkang, as reported by Human Rights Watch:

“I can’t provide food every day like before. Before the company, I used to plant rice and vegetables on a small piece of land. I would use the harvest to feed my family. Now, I plant a little behind my house, not much, and it doesn’t do well like in my farm before.”

GOVERNMENT AND ECONOMIC ACTORS BEHIND THE SYSTEM

However, how has the oil palm exploitation system been put in place, and why does it continue to function while perpetuating socio-environmental damage? Indonesia’s institutional dimension plays a big role, with decentralized governance, a weak legal system and endemic corruption. Local governments and military officials use their legal mandates to favor oil palm companies on land allocation, and they often facilitate illegal cutting and logging. Poor data transparency and overlapping jurisdiction at the national and local level have obstructed the implementation of laws on property and the environment. Moreover, corruption and low-quality governance by local officials have allowed relationships of favoritism and manipulation of the judiciary system by the oil palm companies.

Another factor to address is the weakness of the environmental legal protection framework. In the case of Indonesia, multiple regulations and certification schemes for palm oil production are in place, but they fail to address accountability and to prevent violations from the industry. The most famous body is the Roundtable on Sustainable Palm Oil (RSPO), which has developed a set of environmental and social criteria for companies in order to produce Certified Sustainable Palm Oil (CSPO).

Even if it has raised the issue and increased the commitment to sustainable oil palm management, this multi-stakeholder initiative has revealed many gaps, allowing the continuation of unsustainable operations. There is a lack of data, lack of transparency, and no mechanism to ensure that policies are properly implemented. The compliance system is not strong enough, leading companies to keep circumventing and violating regulations. One recent audit conducted by the government agency, the BPK, found that 81% of Indonesia oil palm plantations violate the existing regulations.

In 2011, the Indonesian government decided to develop a national scheme, the Indonesian Sustainable Palm Oil (ISPO), with the aim to complement the gaps of the existing mechanisms. However, this scheme reflects inadequate standards of transparency and human rights. Compared to the RSPO, the international community considers ISPO not strong enough to be vigilant on companies and to protect the most vulnerable. Overall, the legal mechanisms in place are not strong enough to push the transition to sustainable oil palm management. In the report “Destruction: Certified”, Greenpeace talks about oil palm certifications as being tools that enable “destructive businesses to continue operating as usual.”

FROM COMMODIFICATION TO ECOLOGICAL PALM OIL MANAGEMENT

The dynamics of oil palm exploitation in Indonesia are part of the bigger system of our globalized society, where the economic dimension and economic actors dominate. We talk about commodification, which means the capitalist instrumentation of natural resources. Nature is not seen as a part of human balance, but as a tool of economic gain. Therefore, nature is exploited, and the side effects continue for those who are often the poorest and most vulnerable. The biofuel and food industries dependent on oil palm may create significant revenues for multinational corporations and governments in the region, but they almost never translate into benefits for villagers living in the areas of development. On the community side, what is evident is not poverty alleviation – as is often claimed – but instead the reinforcement of poverty through a change of its nature. This uneven system perpetuates global inequality and underdevelopment, while at the same time threatening the balance of the entire ecosystem.

The story of the palm oil industry in Indonesia has shown that the economic mechanisms described contribute to an increase in poverty, deteriorating the quality of life by destroying nature. And their environmental and human impacts spread from Indonesia to other parts of world. Two main takeaways can be drawn from this situation, both of them related to the concept of ecosystems. The first takeaway is that nature and humans are interdependent. This means that behind the environmental impacts are inevitable impacts on people’s lives. The second takeaway is that the planet’s ecosystem is interconnected. This means that the socio-environmental consequences of oil palm plantations in Indonesia are not limited to the region and Indigenous people. They are a global matter. Thinking about the impact of GHG emissions helps to conceptualize this.

• How can we adjust the capitalist-based and corrupted system in order to restore accountability and transparency to prevent the most powerful actors from destroying the environment and the local population without consequences?
• What is the international community’s role in addressing the issues of the oil palm industry, which are not only particular to Indonesia but also occur in other countries?
• How can we move forward to ecological natural resource management, which combines economic gains with environmental protection, and involves communities as active participants and benefit holders?

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Suggested Readings

• Orth, M., 2007. Subsistence Foods to Export Goods: The impact of an oil palm plantation on local food sovereignty, North Barito, Central Kalimantan, Indonesia.
• Friends of the Earth, LifeMosaic and Sawit Watch, 2008. Losing Ground: The human rights impacts of oil palm plantation expansion in Indonesia.
• Human Rights Watch, 2019. “When We Lost the Forest, We Lost Everything”: Oil Palm Plantations and Rights Violations in Indonesia.