The palm oil industry in Indonesia plays strategic roles both in the national and sub-national economy, as well as in the global supply chain of edible oil.
Indonesia has been the world’s top palm oil producer since 2005, producing more than a half of global palm oil output in 2015/2016. The industry is responsible for 4.5 percent of the national gross domestic product (GDP) in 2010 and was the top contributor (12.3 percent) to national exports in 2016.
For natural resource-dependent regions like East Kalimantan, it is the prime candidate to replace unsustainable fossil fuels that have dominated the local economy for decades. Without palm oil, the world would either need much more land or be unable to meet global demand on edible oil.
Despite its vital role, the industry needs to improve sustainability. It has been identified as one of the major sources of defor...