Indonesian government temporarily stops allowing foreign investment in oil palm sector

Antara 16 May 11;

Solo, Central Java (ANTARA News) - The government has temporarily stopped allowing foreign investors to develop new oil palm plantations so as to give opportunities to local businessmen, Forestry Minister Zulkifli Hasan said.

"There is indeed a policy to reduce the number of foreign investors in the oil palm plantation sector to give more opportunities to local businesses," he said here on Monday at a business gathering on developing people`s potentials and opportunities in economic development efforts held during the meeting of the national council on economy and entrepreneurship of the executive board of Muhammadiyah Islamic organization.

The minister said there are now two million hectares of oil palm plantations which are held by foreign investors such as those from Malaysia and others.

In view of the policy he called on national businessmen including those from Muhammadiyah who wish to participate in the business to take the opportunity, adding that there was still plenty of land for the purpose.

He said there were now around 45 million hectares of critical forest land in the country and 30 million hectares of them may be developed into oil palm, rubber or sugar cane plantations.

He said "concession holders who do not develop their land and ignore it would have their permits revoked."

With regard to reforesting the land he said his ministry continued conducting its reforestation program.

In 2010 he said the ministry had developed 600,000 hectares of people-based forestation projects and this year 700,000 hectares in various parts in the country.

This program is mostly implemented in Java island in cooperation with villagers, he said.

He said his office also provides Rp50 million for developing nurseries for each group involved in the program.

The forestry ministry has so far provided Rp2.5 trillion to help maintain the people-based forests and Rp3 trillion to help develop people-based forests, he said. (*)

Editor: Aditia Maruli