7/8/2006 (The Jakarta Post, Jakarta) - Environmental groups are criticizing the government for setting aside funds to counter a public relations campaign against its extensive palm oil plantation projects.

They said the money would be better spent on efforts to overhaul the country's oil palm industry, such as increasing the quality of the product rather than its quantity, and promoting the use of better seedlings rather than expanded planting to increase output.

"It (the improved system) should include establishing proper spatial planning, halting the conversion of forests, and ensuring the rights of local people to sustainable livelihoods," said Sawit Watch deputy director Abet Nego Tarigan.

Last month, Indonesia and Malaysia agreed to allocate 500,000 euro (US$639,7) to counter campaigns launched by non-governmental organizations against the expansion of palm oil plantations in the two countries.

The deal was signed in Medan, North Sumatra, by Indonesian Agriculture Minister Anton Apriyanto and Malaysian Plantation Industries and Commodities Minister Peter Chin Fah Kui.

Both ministers said the move was prompted by what they called the unfounded accusations of local and foreign NGOs, who argue palm oil plantations have damaged the environment and contributed to the destruction of the two countries' remaining natural forests.

Indonesia and Malaysia now account for 84 percent of the world's crude palm oil production and 88 percent of global exports.

According to the Indonesian Palm Oil Producers Association, Indonesia makes 15 million tons of crude palm oil and two million tons of palm kernel oil annually, making it the world's biggest palm oil producer.

The palm oil industry contributed over US$6 billion to Indonesia's economy last year. It employed from 1.5 to two million people, working for more than 200 companies on more than five million hectares of land across the archipelago.

The government plans to open three million more hectares to palm oil farming by 2009.

Environmentalists have strongly opposed the expansion of palm oil plantations, saying the slash-and-burn method used to clear the land would trigger massive forest fires that could send hazardous haze to parts of Indonesia and neighboring countries.

The Riau provincial administration recently accused two palm oil plantation firms of causing forest fires on some 3,000 hectares of the province's land, including a protected forest, which later caused haze over Malaysia and Thailand.

Mina Susana Setra of the Indigenous People's Alliance of West Kalimantan said the government was wasting money on the campaign.

The move also would likely spark protests from the international community, which discussed the negative impacts of palm oil plantations in the recent United Nations Permanent Forum on Indigenous Issues (UNPFII), she added.

She said delegates of the 5th UNPFII session in New York in late May urged Indonesia not to move ahead with the plan to expand its palm oil plantations, which they said would sacrifice the livelihoods of indigenous people who rely on the forests.

"We've also requested the forum send a special rapporteur to Indonesia to learn the impacts of existing large plantations on indigenous people here," she said.

However, Indonesian Palm Oil Producers Association Chairman Derom Bangun defended the government's move, saying "bad publicity can only be countered by good publicity".

"Not all of the accusations are true. Yes, there is a problem, but we've been trying to improve our performance by upholding the principles of benefiting the people, the planet, and profit," he said.