Trade and markets


Commodity Group
Oilseeds, oils and meals
Oil palm
Policy Category
Policy Instrument
Environmental policy
Approved a two-year extension (until May 2019) of a moratorium on issuing new licenses for the use of land designated as primary forest and peatland, thereby curbing plantation development in the oil palm wood and paper sectors. Subsequently proposed to turn the temporary moratorium into a permanent ban.
Indonesia\'s President approved a two-year extension of a moratorium on issuing new licenses for the use of land designated as primary forest and peatland in the country (see also MPPU June & Aug.’16). The six-year-old moratorium was scheduled to expire on 20 May 2017. Aimed at halting deforestation and pollution resulting from forest fires, the moratorium is said to concern a total of 66 million hectares. According to government officials, the latest extension gives concerned authorities more time to improve rules on forest and peatland governance and gather material to manage licenses more effectively. A number of civil society groups pointed out that forest cover losses remained high during the past six years. Allegedly, during 2014–2015, 1.5 million ha of forest cover were lost. Furthermore, some NGOs claimed that the recurrent outbreak of fires on forestland and drained peatland was to a large extent driven by plantation expansions in the oil palm, wood and paper sectors. While government sources reckoned that some land conversion continued due to permissions issued prior to the moratorium, NGO’s stressed that a number of factors compromised the moratorium’s effectiveness, notably: i) enforcement problems arising from decentralized decision-making; ii) disputes over land tenure; and iii) the circumstance that the moratorium was issued in the form of a presidential instruction, which does not entail legal consequences for perpetrators. A group of forestry experts urged that the moratorium on permits be complemented with livelihood programmes for locals to facilitate the generation of local income from forests without involving conversion.