Fostering sustainability in the Indonesian palm oil production

SECO is committed to ensuring the production of palm oil in Indonesia in a manner that is both environmentally friendly and socially responsible.

Together with the United Nations Development Programme (UNDP), SECO supports the Indonesian Government to take the lead in creating an environment where palm oil is produced more sustainably. A dialogue among all relevant stakeholders has resulted in a national action plan for sustainable palm oil. This action plan was signed into law by President Joko Widodo, demonstrating Indonesia’s commitment.

With the Sustainable Trade Initiative (IDH), SECO is also working to achieve greater sustainability in palm oil supply chains. IDH is active in six provinces, promoting sustainable economic development at the regional level, with a focus on sustainable production, forest conservation and social inclusion. Direct beneficiaries are especially smallholders and their families.

In Indonesia, over 23 million people make a living from palm oil.

Indonesia is the world’s leading producer and exporter of palm oil. In 2019, it contributed over USD 15 billion to Indonesia’s export income. Over 23 million people make a living from palm oil, through either working in sector-related activities or growing palm oil themselves. However, its development has brought with it environmental and social challenges. Drivers of environmentally damaging palm oil production in Indonesia include a lack of resources and capacity, a lack of proper monitoring and regulation at regional and provincial level and poor cohesive and coherent actions among the various actors.

Economic Development Cooperation Programme for Indonesia 2021–2024

Palm oil is an important topic in SECO’s new Economic Development Cooperation Programme for Indonesia 2021–2024. This programme will be launched in mid-February. It implies that SECO will remain committed to the palm oil sector so that environmental and social aspects continue to gain importance and be further improved. SECO-supported projects in Indonesia will improve the welfare of Indonesian palm oil smallholders and residents of palm oil producing regions alongside environmental interventions to ensure social and environmental sustainability.