Jakarta rejects bids for new palm oil projects

JAKARTA • Indonesia has rejected applications from scores of companies for new palm oil operations, an official said yesterday, as it cracks down on an industry whose expansion has been blamed for fuelling haze-belching forest fires.

Almost one million hectares of land were spared from conversion to oil palm plantations due to the decision, said Mr San Afri Awang, a senior official from the Environment and Forestry Ministry.

"We want to save our forests - development should continue - but we can't let it destroy our environment," he told reporters in Jakarta, after announcing that applications from 61 firms had been rejected.

His statement came after the government this month announced it would stop granting new land for oil palm plantations. Indonesia is the world's top producer of the edible vegetable oil, which is a key ingredient in everyday goods, from biscuits to shampoo and make-up.

President Joko Widodo has told planters to increase their yields by using better seeds, rather than expanding into new areas.

Plantations in Sumatra and the Indonesian part of Borneo have expanded as demand for palm oil has shot up, but the growth has been blamed for annual forest fires that occur during the dry season due to illegal slash-and-burn land tactics.

The blazes last year were the worst in years, and cloaked large swathes of South-east Asia in toxic smog, causing tens of thousands to fall ill and leading to flight cancellations and school closures.

Mr Awang refused to say which companies had their applications rejected. He also declined to disclose whether the applications were for new plantations or expansions to existing plantations.

Greenpeace Indonesia forest campaigner Kiki Taufik welcomed the move but said the government must ensure that the local authorities enforce the decision.

"Often these companies are rejected by the central government but then, they start lobbying the regional government," he said.

Implementation of laws is difficult in the country due to heavy decentralisation of power across the archipelago of more than 17,000 islands, with rules set in Jakarta often flouted by local administrations.


A version of this article appeared in the print edition of The Straits Times on May 26, 2016, with the headline 'Jakarta rejects bids for new palm oil projects'. Print Edition | Subscribe