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Yogyakarta. Contrary to previous statements, the government will not revoke existing forestry licenses for palm oil firms as part of a deal with Norway to preserve rain forests, a government minister and an industry official said on Wednesday.

Coordinating Minister for the Economy Hatta Rajasa said the government had no intention of limiting the expansion of the $15 billion domestic palm oil industry, although it was committed to slowing deforestation.

“We want to keep to our target of 40 million tons of crude palm oil,” he said on the sidelines of an industry conference. “We will not take away the existing licenses.

“We have food-security interests and our export earnings to protect, but expansion will be at a sustainable pace for our future generations.”

Hatta’s statement was the latest attempt to clarify the impact of the moratorium on clearing of natural forests. The two-year moratorium was announced last month as part of a $1 billion deal with Norway to fight climate change.

Agus Purnomo, head of the National Climate Change Council, had said on Monday that some licenses to develop natural forests would be revoked, and said on Tuesday that those would only be revoked if work had not begun at the site.

His statements prompted claims from the palm oil industry that the moratorium would dramatically slow growth, by up to half over the next decade.

However, Indonesian Palm Oil Board (DMSI) vice chairman Derom Bangun said on Wednesday that the government had clarified its intentions.

“The government has assured us that the expansion of oil palm estates will continue within reasonable limits,” Derom said.

Leaving existing licenses untouched would allow top planters like Singapore-listed Wilmar and Malaysia’s Sime Darby to continue developing concessions.


Reuters