Palm Oil Replanting, Stakeholders Urged Government to Release Regulation for Financing Farmers

Stakeholders in Palm Oil Industry gathered in a focus group discussion (FGD) titled “Financing Acceleration Policy and Legal Certainty on Palm Oil Farmers Land with Partnership Scheme” in Jakarta, Thursday 9 March 2017 urged government in increasing welfare for palm oil farmers. One recommendation is to synchronise regulation in Palm Oil which would allow farmers to get access to finance. The discussion showed that the banks preferred partnership scheme which is safest in terms of credit repayment.

“The partnership scheme is very effective in helping farmers access short term financing,” Bank Mandiri President Director Kartika Wirjoatmodjo said.

The FGD which was attended by Coordinating Ministry of Economic Affairs, Ministry of Agriculture, Ministry of Agrarian and Spatial Planning, Ministry of Finance, Estate-Crop Fund for Palm Oil (BPDP Sawit), Indonesian Palm Oil Association (GAPKI), farmers representation, and Partnership for Indonesia’s Sustainable Agriculture (PISAgro) through its Palm Oil Working Group along with National Banks also recommended to create regulation for controlling standardisation on the cost of land certification to make it affordable to farmers.

 “In addition to land issues, the government should also pay attention to fulfilling the farmer’s need during the non productive period, we need to adapt any financing regulation for palm oil specifically as the strategic commodity for Indonesia,” said Fadhil Hasan, Indonesian Palm Oil Association Executive Director during the discussion.

Agrarian and Spatial Planning Minister Sofyan Djalil said the government would follow up the recommendations from the FGD as a consideration in the ministry’s policy regarding Palm Oil’s land ownership,  stressing that the ministry will help process the certainty of land ownership in forestry area.