The CPO Export Case Drags Corporations to Be Suspects

%When IKN Comes, Indigenous People Are Worried That Traditions Will Disappear%

The export case of crude palm oil ( CPO) has entered a new phase. After the five individual suspects were found guilty, the Attorney General’s Office named three large corporations, the Wilmar group, Permata Hijau group, and the Musim Mas Group as suspects in this case which cost the state Rp 6.47 trillion.

Ketut Sumedana, Head of the Attorney General’s Legal Information Center, in a written statement received by Mongabay, said that the determination of the suspect for law enforcement is a corporate investigation. “In order to demand criminal responsibility and restore state finances,” wrote the release.

The convict in the previously binding case was Indrasari Whisnu Wardhana, at that time the Director General of Foreign Trade at the Ministry of Trade. Then, Weibinanto Halimdjati alias Lin Che Wei is a policy adviser at the Independent Research & Advisory Indonesia (IRAI) as well as a member of the assistance team for the Coordinating Minister for the Economy.

In this CPO export corruption case, Indrasari was sentenced to eight years in prison and fined Rp. 300 million. Meanwhile, Lin Che Wei was sentenced to 7 years in prison with a fine of IDR 250 million.

There is also the Commissioner of Wilmar Nabati Indonesia, Master Parulian Tumanggor, who was sentenced to 6 years in prison with a fine of IDR 200 million.

From Permata Hijau Group, Stanley MA, as the Senior Manager of Corporate Affairs of PT Victorindo Alam Lestari, was sentenced to 5 years in prison and fined Rp. 200 million. Meanwhile, Pierre Togas Sitanggang as the General Affair Manager of PT Musim Mas was sentenced to 6 years in prison and fined IDR 200 million

The actions of the convicts had a significant impact in the form of expensive and scarce cooking oil last year. The state also has to disburse direct cash assistance of IDR 6.19 trillion to maintain people’s purchasing power for this commodity.

The country cannot be afraid

The urge to ensnare corporations in the cooking oil case has actually been echoed by civil society for a long time. In accordance with the judge’s consideration, civil society judged the convicts to have acted on behalf of their respective companies.

Previously, civil society had filed a lawsuit with case number 150/G/TF/2022/PTUN.JKT regarding the fried cooking oil dispute but was rejected by PTUN judges.

Achmad Surambo, Executive Director of Sawit Watch, said that the determination of the new suspect by the AGO proved that the judge was wrong and that there was negligence by the state so that corporations could cause state losses of IDR 6.47 trillion.

For this reason, the process must also be escorted so that it can actually arrive at trial and the state does not feel intimidated.

Considering that several environmental crime cases involving corporations experience problems in proving or during execution after cases have permanent legal force ( Inkracht ).

“The Attorney General’s Office is already on the track. Now, stay monitored. Many cases involving corporations have come and gone,” said Rambo.

The same thing was called for by Arie Rompas, Team Leader of Forest Campaigner Greenpeace. When contacted separately, he said, the importance of the country’s courage in dealing with big corporations.

For this reason, he said, it is important to ensure that the state dares to act when Inkracht. Including, the confiscation of company assets if they cannot recover the state losses they have caused.

Apart from that, he said, there are two things that need to be addressed so that companies can no longer influence political actors which will lead to legal bias. First, ensure compliance with beneficial ownership (BO).

Second, reforming the electoral process. The General Elections Commission (KPU) should be able to make funding for political parties.

Thus, the relationship between corporations and political actors can be seen from the sources of funding they receive in every election.

One way to ensure there is no conglomeration, he said, is by giving smallholders the opportunity to have diversified palm oil products. So far, the products sold by farmers are only stuck in fresh fruit bunches (FFB).

He said, in fact, the regulation was previously contained in the Regulation of the Minister of Agriculture (Permentan) Number 98/2013 concerning Guidelines for Plantation Business Permits. Article 14 in this legal product includes an obligation for the palm processing industry in cooperation with smallholder cooperatives to sell shares of at least up to 30% in the fifteenth year.

However, he said, the latest revision of the Minister of Agriculture eliminated that point. “Twice this ministerial regulation has been revised and this obligation has been eliminated. This shows that the government is trying to diminish the role of farmers and planters.”

The Question about Palm Cooking Oil Scarcity

That’s part of the lyrics of the song ‘Rayuan Pulau Kelapa’ by Ismail Marzuki. When writing the lyrics of this song, the composer certainly could not be separated from the reality of how this archipelago is rich with coconuts that fill the glory of the economy.

In the 18th century, coconut was once a major trading commodity. Indonesian copra dominates world commodity trade centers (Asba: 2007, Heersink: 1999 quoted in Killing Indonesia). This success was destroyed by the deception of knowledge and the bad campaign that coconut oil is harmful to health because it causes cholesterol, which was loudly voiced by America at that time.

After the second world war, exports of coconut oil to America increased again, far beyond the sales of soybean oil that they were promoting. At least since the Greater East Asia War, when Japanese troops occupied the Philippines and other Pacific areas, the flow of coconut oil was cut off. This situation forced America to develop other cooking oil ingredients, especially soybean oil.

In 1972, they pushed for a law to place a warning label “rich in fats that cause blood vessel obstruction” on coconut oil products.

Until 1988, they continued to promote the bad campaign for coconut oil, even the United States Congress produced a bill to stem the import of coconut oil and palm oil. In essence, the bill requires that oil from tropical regions be tagged with a label that reads: “contains or does not contain saturated fat “.

In the end, farmers in coconut center areas in the archipelago, such as in Sulawesi, Sumatra, and Java, had to face bankruptcy from this campaign. In fact, until now, the tongue of many Indonesians has become foreign to coconut oil.

The history of the death of the people’s coconut industry was previously written in the book “Killing Indonesia.” Not only coconut, but several other commodities such as salt, sugar, and herbal medicine also suffered the same fate.

As the people’s coconut oil industry collapsed, the Indonesian government saw another opportunity, namely palm oil. Superstructure and infrastructure building through policies and legal products that accommodate the expansion of oil palm license expansion by state officials. Coupled with increasing demand for exports from foreign countries, palm oil has skyrocketed rapidly.

In 1912, oil palm was cultivated as a commercial crop and Indonesia’s first CPO export was in 1919. At that time large-scale oil palm plantations were owned by the Dutch government. In 1957, President Soekarno nationalized Dutch-owned companies.

The fall of the Soekarno regime and the replacement of Soeharto opened the investment faucet-wide. Law Number 1/1967 concerning Foreign Investment (PMA) was followed by other sectoral laws such as Law Number 5/1967 concerning Forestry. Since the Forestry Law was enacted in 1967, the granting of business licenses in the forestry sector, such as business permits for the utilization of natural forest (HPH) forest products and business permits for the utilization of industrial timber forest products (HTI) has been massive. He became the door to the destruction of the forests of Sumatra and Kalimantan.

The former forestry concessions were turned into oil palm plantations. At least, in the 1980s, the Government of Indonesia opened wide opportunities for private companies to enter the oil palm business through the national private large plantation program (PBSN).

The People’s nucleus plantation program (PIR) was also encouraged, coupled with the integration of PIR with the transmigration program (PIR-Trans). In this way, large-scale oil palm owned by large companies is increasingly widespread.

In 1980, the area of ​​oil palm in Indonesia was 200,000 hectares, almost all of which were inherited from the Netherlands. Until 2009, the area of ​​oil palm plantations reached 7.2 million hectares. As oil palm plantations expand, infrastructure development such as crude palm oil (CPO) factories also continues to increase. Again, CPO factories are dominated by private companies.

By 2021, the area of ​​oil palm will reach 14.9 million hectares. The expansion of palm oil can be even higher as the Job Creation Law appears, which is currently conditionally unconstitutional. Investment is the soul of this law. Other policies, such as the development of biofuels (biofuels) with a focus on palm oil sources.

At least in 2018, the European Union consumed 53% of all imported palm oil for biodiesel, in addition to that 12% of palm oil imports were used for heating and electricity. This means that 65% of imported palm oil is burned to make biofuel, the rest is for food and for the olechemical industry (Transport and Environment, 2019).

In fact, stimulated the expansion of oil palm plantations in Indonesia, which in the end this expansion sacrificed a lot of Indonesian people’s lives, Indonesian forests, the environment, and protected animals.

Not only fulfilling the consumption of the European Union, Indonesia also fulfills the consumption of countries in other continents such as Asia, Africa, Australia, and America.

In the Study of the Power of Oil Palm Tycoons in Indonesia compiled by TuK Indonesia, 9 million hectares of oil palm plantations are controlled by 25 oil palm company groups, which are controlled by 29 wealthy families.

Of the 25 company groups, only five groups hold important control over the area of ​​the planting area. Holding important control over the area under cultivation, they also hold control over the palm oil mills. Including, controlling the production of cooking oil.

Several brands of packaged cooking oil that are currently used, such as Filma, Mitra, and Kunci Mas, are owned by the Sinar Mas Group. Sania, Siip, Sovia, Fortune, Camilla, Mahkota are owned by the Wilmar Group. Bimoli, Delima, and Happy are cooking oil brands owned by the Salim Group.

Ownership of land planted with oil palm between companies and people is very unequal. Around 2.74 million farming families only control 5 million hectares of smallholder oil palm (BPS: 2019).

Even if examined factually, the people’s gardens mentioned by BPS in the field are mostly controlled by small landlords who are also political elites, government elites in the regions, and other investors.

Not to mention, not a few of these people’s oil palm plantations operate under a plasma partnership scheme, such as village treasury gardens, village community gardens, and other plasma partnership schemes with different names.

The scarcity of palm cooking oil on the market is only a small part of the problems that must be borne by the increasingly widespread oil palm plantations. The fundamental problem, the capitalistic style of economy, with major consequences is the large-scale domination of natural resources by investors who are legitimized through policies and legal regulations.

Other side-effects are the confiscation of people’s managed areas (WKR), agrarian conflicts, criminalization, violence, and the quality of the environment has drastically decreased and human rights violations and deforestation have occurred in various parts of Indonesia.

During the dry season, clean water crises occur everywhere, and forest and land fires continue to occur every year. From 2016-2021, an area of ​​3.4 million forests and peatlands burned. These forest and land fires are in forestry licensing concessions and company oil palm plantations. Very large losses due to this fire must be borne by the people and the state.

Not only material losses but also non-material ones such as asthma, children not being able to go to school and play, as well as other bad memories about the gloom of daily life due to the smoke from forest and land fires. This smoke is even detrimental and disturbing citizens of other countries, such as Malaysia and Singapore.

Walhi noted that throughout 2021 at least 58 criminalization cases, 34% of cases in the plantation and forestry sectors.

The life of the people who work as laborers in the oil palm plantations is also bad. Violations of the human rights of women and men workers often occur. Daily labor wages do not match the work performed. In fact, to achieve the daily target, workers must invite their children or other family members to work on the plantation without pay.

They have the equipment to work. Women workers fertilize, and spray plant pests, and are not given complete protective equipment. In fact, chemical substances from fertilizers and pest disinfectants are very dangerous for women’s health. In fact, in several studies in several areas, there was the rape of female workers in palm oil companies.

Protect the territory of the people

Too much has been taken, and the heavy burden that must be borne by the people proves that the state has mismanaged livelihood resources. Now is the time for the state to admit failure by acknowledging and protecting people’s management areas.

In the areas managed by the people, there is diversity, collectivity, wise practices in managing livelihood sources, and economic strength that is proven to have high resilience. Walhi conducted an economic study, hereinafter referred to as the archipelago’s economy, in several people-managed areas in five landscapes. Namely, peat, highland forests, Sumatran hills, lowland, and coastal forests.

The archipelago’s economy in this people’s management area has four binding values, first, historical relations, second, relations with ecological landscapes, and third, non-destructive economic practices. Fourth, it has a dimension of restoration of socio-ecological conditions.

This study states, in one study object village, no less than billions of money circulate from the results of the diversity of village community products.

Supposedly, the archipelago’s economy that is built in the people’s management area should become the strength of the nation so that recognition and protection are the most important and fundamental things that must be done. For this reason, superstructures and infrastructure are needed to strengthen the people’s economy.

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