Southeast Asia gears up for palm oil boom

JAKARTA, Sept 16, 2007 (AFP) – Southeast Asian nations are gearing up for a palm oil boom as interest in biofuels soars, but activists warn the crop may not satisfy a global thirst for energy that is both clean and green.

They caution that oil palm plantations require massive swathes of land — either what’s left of the region’s disappearing forests, denuded plots that would be better off reforested, or land critical to supporting local people.

Governments and companies have been scrambling to cash in since palm oil prices jumped last year due to spiking demand from China, India and Europe, where biofuels should comprise 10 percent of motor fuels by 2020.

Indonesia has launched a particularly ambitious biofuels expansion programme, which aims to see Southeast Asia’s largest economy source 17 percent of its energy needs from renewable sources by 2025.

Evita Herawati, an assistant to Indonesia’s minister of energy, said 5.5 million hectares (13.5 million acres) will be set aside for biofuel plantations by 2010, 1.5 million hectares of which are for oil palm.

The main objective is "to create jobs and alleviate poverty," with some 3.5 million new jobs being eyed by 2010.

"A lot of forest has been cut down but they didn’t use it at all. We would like to use it for this programme," she told AFP, adding that so far 58 deals worth a total of 12.4 billion dollars have been signed with companies.

She estimated that just in Kalimantan, the Indonesian portion of Borneo island, about 5.5 million hectares are available for use — an area far larger than Denmark and a bit smaller than Sri Lanka. Nine million additional hectares are available elsewhere, Herawati said.

The issue of where the land will come from worries activists, who point out that much of Indonesia’s peatland forests have already been destroyed, releasing huge amounts of carbon dioxide.

Rully Syumanda, of Indonesia’s environmental watchdog Walhi, said proposing palm oil plantations has been used in recent years in Indonesia "as a pretext to clear land and take the more valuable logs".

He estimates that nearly 17 million hectares of Indonesia’s forests have been cleared ostensibly for oil palm plantations since the 1960s, but only six million hectares have been cultivated.

Though he concedes that the government is now making efforts to reforest, catch offenders and audit the industry, Syumanda said these were "insignificant compared to the damage that is being inflicted on the environment".

Rudi Lumuru, from Sawit Watch, an industry monitor, meanwhile said much of this "empty" land is actually used by local people. He reckons more than 500 communities have been embroiled in conflicts with more than 100 palm oil companies, typically from Malaysia.

"This land has been used since a long time ago by the people. They live on the land, they grow on the land," he said. "The government says people can make money, but it’s about transition of culture. The culture of the farmers, it’s rice, coffee, cocoa — it’s not palm oil."

— Compensation too little to deter corruption —

While compensation payments may be meted out, they end up being meagre thanks to endemic corruption, he added.

The Indonesian industry says it is cleaning up its act.

"The industry now is trying to avoid destroying land," said Derom Bangun, executive chairman of the Indonesian Palm Oil Association. "Companies no longer clear land by burning or in ways that harm the environment or wildlife."

Indonesian companies have joined the Roundtable on Sustainable Palm Oil (RSPO), a WWF-led initiative to engage palm oil companies, and is trying to abide by their principles, he said.

Technology minister Agusman Effendi said that economic factors as well as "sustainability of the environment and the way the government can give extra support to the poor" needed to be considered.

"The ‘what’ has been defined clearly, but the ‘how to’ is the thing that has been criticised by the public," he said.

Companies in Malaysia, the world’s largest palm oil producer — expected to be eclipsed by Indonesia this year — are being lured here by the vast expanses of already-cleared land.

Malaysian plantations minister Peter Chin insists palm oil production does not damage the environment and said Malaysian companies will boost productivity by replanting with higher yielding clones and adopting good agronomic practice.

"We are committed to ensuring that whatever we do now is not at the expense of the environment and our future generations," he said.

According to the Malaysian Palm Oil Board, 65 percent of Malaysia’s total land area of almost 33 million hectares is comprised of forest. Palm oil plantations use 12 percent.

Alvin Tai, plantation analyst at OSK Securities, said most of the companies listed on the Malaysian bourse are expanding in Indonesia as landbank in Malaysia is limited.

He said most major plantation firms were RSPO members and "they have the resources to maintain those standards. It’s the smaller plantation owners that are a concern".

— As prices rise, farmers devote more land to palm oil —

Meena Rahman from Friends of the Earth Malaysia disputes the government’s claims and says the group is particularly concerned about projects in Sarawak, on the Malaysian side of Borneo island.

She says there is evidence that 1.5 million hectares of land that was to be set aside for protection and water catchment purposes has been planted with oil palm as well as pulp and wood trees.

"Maybe what Peter Chin is saying is that they are planting palm oil in areas that have already been logged — but they should allow reforestation to take place instead of allowing palm oil expansion," she said.

Malaysia’s northern neighbour Thailand is also getting in on the game.

High prices for palm oil, driven by Bangkok’s search for alternative fuels, have driven more and more farmers to convert rubber and fruit plantations to grow oil palm, an official from Thailand’s agriculture ministry said.

Local prices of palm oil have almost doubled to more than four baht (seven cents) per kilogramme (2.2 pounds) from two baht last year.

Last year Thailand had some 32,000 hectares planted with oil palm, but the area is expected to jump to 81,000 by year end. An additional 400,000 hectares of unused farmland in the south could also be used, the official said.

The government has provided soft loans to help farmers make the switch, and is considering a floor price for the crop, she said, adding that "we don’t have environmental issues" linked to palm oil, like Thailand and Malaysia.

The Philippines meanwhile has about 25,000 hectares under cultivation, but some 454,000 hectares of "disposable land" — pasture or shrubbery — mostly in the south, has been earmarked as well, the agriculture department said.

So far however, only one Singapore-based company has come sniffing, seeking at least 25,000 hectares of land.

Suharto win puts Indonesia court under scrutiny: analysts

JAKARTA, Sept 11, 2007 (AFP) – A decision by Indonesia’s top court to award ex-dictator Suharto millions of dollars in a defamation suit calls the judiciary’s integrity into question and imperils press freedom, activists and analysts warned Tuesday.

The Supreme Court ordered on Monday that US-based Time magazine pay damages to Suharto to the tune of 106 million dollars for publishing an article in 1999 that alleged the former president squirrelled away billions of dollars abroad.

Time said in its story that it had traced some 15 billion dollars in wealth accumulated by Suharto and his six children following a four-month investigation across 11 countries.

This allegedly included nine billion dollars in cash transferred from a Swiss to an Austrian bank shortly after Suharto stepped down in May 1998.

The court also ruled that Time apologise to 86-year-old Suharto, who has never stood trial over persistent allegations of massive corruption during his 32-year rule.

The ruling showed the Supreme Court was out of touch with "the new situation now prevailing in Indonesia," said Amiruddin, a campaign coordinator for Elsham, a private policy institute.

Suharto’s downfall ushered in an era of reform to the world’s fourth most populous nation, but many have been disappointed over the pace of change in some areas — such as the judiciary, where Suharto’s shadow still looms large.

"We can only surmise that the characteristics of many of the Supreme Court judges have not changed from, let us say, 10 years ago. They continue to put Suharto on a pedestal, as he if he was a god," Amiruddin told AFP.

"The only way (to instigate change) is to inject young blood into that institution," he said.

Fadjroel Rachman, who heads an Indonesian research group working to uncover Suharto’s crimes, said he feared the "scandalous" decision may colour other court action underway against Suharto and his youngest son Tommy.

State prosecutors are bringing a civil suit against Suharto over alleged corruption related to some foundations he chaired. They are seeking 1.5 billion dollars in returned state assets and damages.

Tommy meanwhile is facing criminal and civil graft-related suits.

"The Supreme Court is being used to save corruptors… The individuals in the Supreme Court behind this case are Suharto’s proteges," Rachman charged.

He noted that head judge Bagir Manan, who was on the three-judge panel ruling in Suharto’s favour, had cut a jail term Tommy was serving for ordering the murder of a judge.

Manan was also on a panel that quashed the conviction of a pilot for murdering a high-profile activist critical of Suharto-era abuses.

"This is suspicious," he said.

Supreme Court judges — at most, 60 — are selected by a judicial commission and approved by parliament. They retain their post until retirement.

Gunawan Muhammad, former editor of the Tempo weekly news magazine, said that the impact of the decision was to cast "the Supreme Court itself in a bad light," adding that it was also a worrying move for press freedom.

Frans Hendra Winata, a member of the national commission of law, described the ruling as a significant setback for a formerly shackled press which has flourished since Suharto’s demise.

The press "will not be able to help efforts to eradicate corruption and with this verdict, it is now clear on whose side the Supreme Court is… The press will now think twice before reporting on corruption," he said.

Julia Fromholz from Human Rights First, a New York-based organisation that monitors accountability in Indonesia, said the decision stood in stark contrast to the failure to bring rights cases from Suharto’s era to trial.

"The courts have long failed to hold past and current officials accountable for their actions, but this decision even further highlights the persistence of impunity in Indonesia," she told AFP.

Three years on, killer of Indonesian activist still at large

JAKARTA, Sept 6, 2007 (AFP) – Three years after the high-profile Indonesian activist Munir Said Thalib died on an Amsterdam-bound flight after imbibing a lethal dose of arsenic, the mystery of who ordered his death looms large here.

Indonesia’s President Susilo Bambang Yudhoyono has said solving the September 7, 2004 murder of Munir, a 37-year-old father of two, would be a test of the nation’s progress in reform since the end of the repressive Suharto era.

So far, Indonesia has failed.

Pollycarpus Priyanto, a Garuda pilot who travelled off-duty on the fateful flight and is accused of links to the powerful national intelligence agency, BIN, was convicted of the murder in 2005.

Munir’s supporters believe someone else masterminded the killing and have campaigned to find out who, suspecting the answer lay within the ranks of BIN.

When the Supreme Court quashed Priyanto’s conviction in October last year, his supporters were stunned.

"We didn’t even get a scapegoat. This was crazy," Usman Hamid, a human rights worker for Kontras, one of the organisations founded by Munir, told AFP.

Thanks to widespread international support, a new head of the police’s criminal investigation department was appointed in 2006 and a new attorney-general installed this year, and the case has been rekindled.

A Jakarta courtroom has been hearing startling fresh testimony from a cast of characters seemingly plucked from the pages of a paperback thriller as state prosecutors seek to have the Supreme Court review their decision.

There’s the long-haired musician, who told police he saw Priyanto with Munir at a coffee shop at Changi airport during transit. He then changed his testimony on the stand, alleging he was whisked to Singapore, where he was warned he would be charged with the murder unless he testified to seeing the pair together.

There’s the detained former Garuda head Indra Setiawan, who was mortified to hear a tape recording aired in court of a phone conversation in which Priyanto assures him the pair have nothing to worry about.

"Almost 90 percent of state functionaries are on our side," including the Supreme Court’s chief and his deputy, the pilot said on the tape.

"And the justice will not be there, will never be there. You are only being sought to go after me, and this is in reality only a political game, so that SBY does not get prodded by the NGOs," Priyanto said, referring to the president by his initials.

Setiawan testified he had received a classified letter from BIN asking that Priyanto be assigned to corporate security, a move that allowed him to gain access to Munir’s flight.

The letter — now missing — links Priyanto solidly to the agency.

Then there is the junior intelligence agent, who told police he was ordered to kill Munir and recounted various plots, including asking a paranormal expert to cast a hex on the activist.

But he later told the court he was only ordered to monitor Munir.

Opinion on how the case will pan out, with its inconsistent evidence, is mixed.

Munir’s widow, Suciwati, told AFP that her grief "requires justice" and that she remains optimistic that the conspiracy will eventually be exposed.

"I’m expecting a good surprise that will bring this case closer to capturing the masterminds and bringing them to justice," she said.

But Ken Conboy, a security analyst who has written a book on Indonesia’s intelligence service, is not convinced.

"Recent Indonesian history is filled with these frustrating mysteries," he said.

"If someone intended this to shut (Munir) up, to send a signal to activists, it hasn’t been the result. The result is that the activists haven’t bowed down to this and Munir is much larger in death than in life," he told AFP.

Asmara Nababan, a member of a fact-finding team appointed by the president to uncover the masterminds — whose report was never made public — believes Priyanto should be re-convicted.

"But to find the one who made the decision… the evidence presented in the court is not enough," Nababan, a former secretary-general of the national human rights commission, told AFP.

He noted that BIN has been "an untouchable institution" for many years and that while Yudhoyono spouts the right rhetoric, he is not sure "that there is really 100 percent support from the president to police."

"If you recall the statement of the president — this is a test of history… I hope we pass this test with a good grade but we’ll see."