11/07/2023 (Antara News), Jakarta - The Ministry of Cooperatives and Small and Medium Enterprises (SMEs) and the Roundtable on Sustainable Palm Oil (RSPO) have signed a memorandum of understanding (MoU) to strengthen small farmers' capacity to accelerate the implementation of sustainable palm oil in Indonesia.

During the MoU signing event on Monday, Cooperatives and SMEs Minister Teten Masduki highlighted two main areas of cooperation: the green economy and its socio-economic impact on palm farmers.

The minister emphasized that the collaboration with RSPO aims to mitigate the negative impacts of the palm oil industry on tropical rainforests, biodiversity, and the rights of local residents.

Cooperative efforts will focus on promoting transparency, accountability, and active participation to transition towards more sustainable palm oil production and enhance the economic value for palm farmers through cooperatives.

The MoU was signed to develop and strengthen independent palm farmers' cooperatives, considering Indonesia's position as the world's largest palm producer, with a land area of 15.08 million hectares under palm plantations.

Therefore, it is crucial for palm oil farmers in Indonesia to join cooperatives, which will provide them with better bargaining power and integration from upstream to downstream, ultimately enabling them to achieve economic scale.

The minister expects that cooperatives in the palm plantation sector can act as consolidators for palm land managed by cooperative members.

During the signing, Joseph D'Cruz, the CEO of RSPO, stated that the MoU will serve as a foundation for improving the capacity of independent farmers' cooperatives to accelerate the implementation of sustainable palm oil in Indonesia.

D'Cruz noted that the formal partnership with the ministry comes at an opportune time, with more stringent regulations promoting increased traceability in the palm oil supply chain.

The MoU's scope includes the exchange of data and information, capacity development of independent farmers' cooperatives, cooperative empowerment, guidance synergy, and assistance for independent farmers' cooperatives.

The RSPO scheme also encompasses promoting sustainable palm oil among independent farmers' cooperatives under the ministry and strengthening the economic organization of these cooperatives.

Additionally, the scheme addresses funding and financing access to enhance the capacity and establishment of independent farmers' cooperatives, certification processes, and active participation and involvement of these cooperatives in events organized by RSPO and the ministry.

Furthermore, the collaboration aims to encourage and promote the downstreaming of sustainable palm oil products, specifically red cooking oil produced by independent farmers' cooperatives.

https://en.antaranews.com/news/287856/ministry-rspo-agree-to-boost-capacity-of-oil-palm-farmers