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RI looks west to Papua, West Papua for green investing, empowering farmers
The government is inviting the private sector to participate in promoting green investments to empower farmers in Papua and West Papua and to reduce the two provincial economies' dependency on oil palm plantations and forestry
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he government is inviting the private sector to participate in promoting green investments to empower farmers in Papua and West Papua and to reduce the two provincial economies' dependency on oil palm plantations and forestry.
Coordinating Maritime Affairs and Investment Minister Luhut Pandjaitan said that at least 24 companies, including American coffee company Starbucks, had expressed interest in green investments in the nation’s westernmost territory.
The government is looking to raise about Rp 2.8 trillion (US$200 million) for the green investment program through private-sector grants and investment as well as state funds.
The investment program aims to help local farmers cultivate cash crops such as cacao, coffee, nutmeg, sago and algae as well as develop local ecotourism. As many as 60,000 families in the two provinces are expected to benefit from the program.
“[We don't want] the people to raid the forests anymore, so we have put a moratorium on forestry development. No more palm oil plantations here, most of which are owned by big companies. Instead, we want small and medium enterprises to develop,” Luhut told reporters on Feb. 27 in Sorong, West Papua, after a meeting involving private executives and local officials.
According to the Agriculture Ministry's data, 125,606 hectares of oil palm plantations exist in Papua and 97,459 ha of oil palm plantations in West Papua in 2019.
The green investment program aims not only to empower the local people, but also to protect the provinces' forests, as the investments are to be located outside forested areas.
“The West Papua administration is committed to maintaining 70 percent forest cover. This is an important guide for sustainable development,” said West Papua Governor Dominggus Mandacan.
Dominggus said that fishery, ecotourism and other land-based economic sectors in West Papua grew only 2.87 percent in 2018.
“These sectors have quite [a solid] development potential to increase the province’s revenues, but we can only develop about 22.3 percent from 7 million hectares of our arable land,” he said.
Meanwhile, Papua Deputy Governor Klemen Tinal said that green investment was already in Papua, as the native population had grown cash crops since the Dutch era.
“It turns out we have been [practicing] green investment since long ago, such as [cultivating] cacao, nutmeg, coffee and vanilla. We have already done all this, now we only need to upgrade [them] as export-oriented businesses,” Klemen said.
Sustainable Trade Initiative program director Zakki Hakim said at Thursday's event that Papuans must develop alternative commodities and scale them up before moving away from oil palm.
“The problem is that the [current] volume is still too small,” he said, adding that there was external demand for Papuan commodities, but that this was difficult to meet due to transportation problems.
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“The West Papua administration is committed to maintaining 70 percent forest cover. This is an important guide for sustainable development.”
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Because of the limited road network in Papua, transportation between urban centers generally rely on aircraft. Smallholder farmers in the hinterland thus find it difficult to transport their crops to cities for shipping to destinations outside Papua.
Zakki said the local governments needed to look for an appropriate business model and develop a pilot project that could be replicated on a large scale.
Meanwhile, Paul Polman, the founder of sustainability consultancy IMAGINE, said that green investments should be directed at improving the livelihoods of the local people, protecting nature and developing industries that did not incur environmental damage.
“Seeking an economic model will take time, that’s why it needs 10 years to develop the program,” he said.
Polman added that although a change in the governor could also mean changes in policy, the long-term goals of the green investment program could be sustained if the program and its goals were well formulated and documented.
Meanwhile, several companies have expressed interest in the program, but said they needed assurances that the local government would closely monitor cultivation so that farms would produce good yields.
OLAM Indonesia vice president Vijay Karunakaran said that the company would be behind the program if it could promote regional productivity.
“Any program in Indonesia that can increase productivity, we will support it,” said Karunakaran.
Meanwhile, Panut Hadisiswoyo, the sourcing hub director at handmade cosmetics company LUSH Indonesia, also said at Thursday's event that the company used raw materials produced by community-owned plantations, but that not all plantations could meet the company’s standards.
“LUSH does not want to source its materials from [just] anywhere," he said, stressing that the company's suppliers must not contribute to deforestation.
Panut added that LUSH would use raw materials from Indonesia, particularly Papua and West Papua, if the local government could ensure supply certainty and that the materials did not come from protected forests.
