Failing governance - Avoiding responsibilities

This report by Friends of the Earth Netherlands and WALHI KalBar examines how European biofuel policies and the resulting demand for palm oil have driven unsustainable plantation expansion in the Ketapang District of West Kalimantan, Indonesia. It details systemic failures in governance, including the issuance of 'fast track' permits that bypass environmental and social safeguards, leading to illegal deforestation, carbon emissions, and severe land conflicts with indigenous communities.

• The Ketapang district government rapidly expanded oil palm licensing between 2004 and 2007, increasing the area licensed for expansion from 21% to at least 40% of the district's total land area in just three years.
• A 'fast track' licensing process in Ketapang allows companies to obtain permits while waiving legal requirements. For example, PT Fangiono Agro Plantation, a subsidiary of RSPO member First Resources, obtained its Location Permit in only six weeks, whereas the full permitting process typically takes three to five years.
• Most oil palm companies in Ketapang operate without approved Environmental Impact Assessments (EIAs). In 2008, only 17 out of approximately 90 companies had an approved EIA report, and many subsidiaries of RSPO members, including Cargill, Sime Darby, and SMART, began activities without these approvals.
• Significant illegal encroachment into protected forestlands has occurred, with 39 oil palm permits in Ketapang overlapping with nearly 400,000 hectares of protected forest. This illegal conversion results in biodiversity loss and a projected loss of US$ 153 million in forestry taxes for the Indonesian State.
• Oil palm expansion has led to widespread land conflicts and the marginalization of indigenous peoples. By the end of 2008, at least 20 major land conflicts had surfaced, often involving companies developing land without community consent or failing to deliver promised smallholder schemes.
• Smallholders in Ketapang face extreme economic vulnerability. In March 2009, approximately 40,000 villagers from 26 villages demonstrated against the Benuah Indah Group (PT BIG) after not being paid for palm oil fruit for four months, with the company owing nearly 100 billion rupiah (€ 7 million).
• The RSPO (Roundtable on Sustainable Palm Oil) has failed to ensure sustainability in Ketapang. While RSPO members control over 600,000 hectares of land in the district, not a single plantation in Ketapang had been certified as of the report date.
• EU biofuel policies, specifically the Renewable Energy Directive (RED), are identified as drivers of unsustainable expansion because they do not require companies to demonstrate the legality of imports, potentially subsidizing palm oil from illegal sources.
• The report identifies a 'replacement effect' where the use of certified palm oil for biofuels pushes the food sector to source palm oil from uncertified, unsustainable estates, thereby neutralizing the benefits of certification.

APA

Friends of the Earth International (2009). Failing governance - Avoiding responsibilities. https://www.foei.org/wp-content/uploads/2020/12/Biomassa_Failing-governance-avoiding-responsibilities_september2009.pdf

Chicago

Friends of the Earth International. Failing governance - Avoiding responsibilities. 2009. https://www.foei.org/wp-content/uploads/2020/12/Biomassa_Failing-governance-avoiding-responsibilities_september2009.pdf.

Wikipedia

{{cite report |author=Friends of the Earth International |title=Failing governance - Avoiding responsibilities |date=September 2009 |url=https://www.foei.org/wp-content/uploads/2020/12/Biomassa_Failing-governance-avoiding-responsibilities_september2009.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{friendsoftheearthinternational2009failing, author = {{Friends of the Earth International}}, title = {{Failing governance - Avoiding responsibilities}}, institution = {Friends of the Earth International}, year = {2009}, month = sep, url = {https://www.foei.org/wp-content/uploads/2020/12/Biomassa_Failing-governance-avoiding-responsibilities_september2009.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }