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Palm oil conflicts persist amid lack of resolution in Indonesian Borneo

Deforestation for palm oil and mining in West Kalimantan, Indonesia. Image by Rhett A. Butler/Mongabay.

  • Efforts to resolve land conflicts between palm oil companies and local communities in western Indonesian Borneo have largely failed, with many disputes festering for more than a decade, a new study shows.
  • Of 32 conflicts analyzed, 66% haven’t been resolved, even though 72% have been mediated by local governments, lawmakers and police.
  • The researchers say the authorities tend to not enforce the law on companies and have instead tended to take a harder line on community members protesting against the companies.
  • The study also found that other avenues of redress for the community, such as filing a complaint with certification bodies like the RSPO, remain underutilized because of complicated procedures and a lack of trust in institutions.

JAKARTA — The framework for resolving land disputes involving palm oil companies in Indonesian Borneo has largely failed, allowing conflicts to fester for a decade or more, with very few ever being settled, a new study shows.

Researchers from the Royal Netherlands Institute of Southeast Asian and Caribbean Studies (KITLV) and the Indonesian NGO Gemawan focused on 32 conflicts out of a total 69 that have been identified between palm oil companies and communities in West Kalimantan province.

In most of the cases, the communities say they haven’t been fairly compensated for their land or the companies have failed to allocate parts of their concessions to be managed by locals, under a scheme known as plasma cultivation.

In some cases, the companies have relied on local figures who don’t represent their communities; failed to adequately and accurately inform the communities about the potential impact of their plantations; and even hired thugs to intimidate community members.

“There are many conflicts related to the plasma scheme promised by companies, which aren’t being met, or people feel they aren’t being implemented well and transparently,” said KITLV senior researcher Ward Berenschot. “Second is land grabbing. People feel their lands have been taken away by companies without fair compensation.”

Of the 32 conflicts that the researchers studied, 21 are related to the plasma scheme and 15 to land grabbing. Nearly all the disputes involve more than one grievance.

There have been efforts made to resolve these conflicts, from mediation by officials, to complaints lodged with sustainability certification bodies, but most of these cases have still not been settled.

“There seems to be no solution for 66% of the cases,” Berenschot said. “The conflicts are still there and there’s been no result [from the efforts], or just a few.”

And communities often have to fight for years, often more than a decade, to reach a resolution.

“We found the process to solve conflicts to be long, usually it takes five years [on average], and many cases haven’t been resolved,” Berenschot said. “The 66% of [unresolved] cases have been going on for 10 years on average.”

To determine whether a conflict had been resolved, the researchers gauged public perceptions on the matter, asking people affected by the conflict whether they thought the efforts to address it had been effective. Thirty-eight percent of respondents said the efforts had failed completely, while 28% said they had failed almost completely.

Momonus chiefs the Dayak Iban indigenous group in West Kalimantan province. The group has been in conflict with a major palm company in Indonesia. Image by Basten Gokkon/Mongabay.

Government failure to resolve disputes

KITLV researcher Ahmad Dhiaulhaq said much of the resentment on the part of the communities was directed at local authorities they considered had failed to mediate a resolution.

Twenty-six of the 32 conflicts studied featured some form of mediation by local governments, lawmakers and police, highlighting the communities’ reliance on authorities to fix the problems. But in only three of these cases were agreements between the communities and companies achieved and implemented, Ahmad said. In five other cases, agreements were reached but had not yet been implemented.

In some cases, the officials mediating the conflicts don’t have the authority to make decisions, Ahmad said. “As a result, the meetings facilitated by the government don’ produce the expected results,” he added.

And in the cases where companies are uncooperative and unwilling to meet the communities in the middle, it’s very rare for the government to punish them.

“We see lack of sanctions for companies that are not being cooperative,” Ahmad said. “Of course there are companies that are cooperative, but we also found on the ground that there were companies that didn’t show up when they’re invited [to resolve conflicts with communities].”

And even when companies have been ordered to relinquish part of their concessions for communities, there’s little to no enforcement, he added.

“There are district heads who have issued decisions for companies to [change] the status quo,” Ahmad said. “But [the decisions] aren’t enforced on the ground and the government seems to not be able to do anything when the companies don’t carry out the district heads’ decisions.”

The West Kalimantan provincial plantations agency responded to the findings of the study by saying that it showed the industry’s incidence of conflict was low. With 378 registered palm oil companies operating in the province, and only 69 conflicts identified, that works out to less than one conflict per company, said agency head Heronimus Hero.

“I see around 0.18 conflicts [per company] compared to the total number of companies in West Kalimantan,” he said.

Sadino, a legal adviser to Indonesia’s main oil palm business association, GAPKI, agreed: “From that percentage, I think it’s still something that’s very reasonable,” he said. “But does reasonable mean we are satisfied? Of course not.”

Heronimus said that in some cases, it was the companies, and not the communities, that were the victims of these conflicts.

“It turns out that lots of companies have also fallen victims, but [these cases] don’t come to the surface,” he said. “For example, in Landak district, the ones who harvest [the oil palm crops] are local people, not the company, even though the company is the one who invests. And then in Kubu Raya district, there’s a case where [the company] has clearly [paid] compensation, but the villagers unilaterally cancelled [the agreement] without returning the compensation [money].”

He said these cases showed the government has to be fair in mediating conflicts.

“Companies have to be protected as well because they have permits to operate,” Heronimus said. “There’s no way they can cultivate such vast lands without permits.”

Oil palm fruit bunches in a truck for transport to market. Image by John C. Cannon/Mongabay.

Other avenues for redress underutilized

Even as they perceive the government to have failed to look out for their interests, aggrieved communities are not making use of other means of conflict resolution, such as courts or certification bodies like the Roundtable on Sustainable Palm Oil (RSPO), the world’s largest association for ethical palm oil production.

Companies that are members of the RSPO are required to resolve any existing land conflicts with Indigenous peoples and smallholder communities to qualify for certification. They are also obliged to acquire the free, prior and informed consent (FPIC) of the communities in where they operate.

If RSPO members are found to be involved in ongoing disputes, the affected communities can lodge a complaint with the RSPO, which would then mediate through its dispute settlement facility.

Litigation in local courts is also an option for communities seeking redress. Yet these avenues remain underutilized, with only five of the 32 conflicts studied going to court, and five going to the RSPO, according to the study.

Ahmad attributed this low rate to a number of factors, such as cost, lack of trust in institutions, and complicated procedures.

Berenschot said that in many legal cases, judges tend to rule in favor of the companies.

“The people often lose [in court],” he said. “Even if they win, with two such cases in West Kalimantan, the verdicts aren’t enforced. So even if they win, they don’t get the benefits.”

Hermansyah, a law professor at West Kalimantan’s Tanjungpura University, said this is because courts tend to take a purely procedural view of such matters — determining whether the companies have the necessary permits — instead of trying to seek justice.

As a result, communities either have to rely on government officials like district heads to side with their cause, or take to the streets in protest.

“So people said let’s not bother going to the court, it’s better for us to protest, it might be more efficient,” Hermansyah said.

For the most part, these protests have been peaceful, with only six conflicts giving rise to violent protests, according to Berenschot.

“What’s interesting is that people tend to avoid violence or anarchy because they usually demonstrate peacefully,” he said. “Sometimes there is violence, but not often, and the violence is done by both the locals and also plantation security.”

Despite this, community members are often subject to arbitrary or frivolous criminal charges brought by the companies. This happened in 10 of the disputes, resulting in the arrests of 94 people.

“There’s a problem with criminalization,” Berenschot said. “Many protesting local figures are arrested by the police during or after the protests, with accusations that are sometimes [valid], but sometimes not as well. And this complicates the conflict resolution because a lot of efforts [have to be made] to free the figures.”

Indigenous peoples and smallholders have been among those arrested for calling for fairer treatment.

“In many cases, the main demand from the people is to receive better compensation from oil palm plantations,” Berenschot said. “For example, they want better benefit sharing or better implementation of the plasma scheme.”

Other common demands include better compensation for lands that they have lost; for the return of parts of their land; and for companies to contribute more to the communities by providing jobs. In general, Berenschot said, the communities aren’t rejecting the presence of the palm oil companies or demanding that plantation activities be stopped.

“On the contrary,” he said, “they want to receive better compensation for the lands that they’ve contributed for the development of oil palm plantations.”

Interior of an oil palm plantation in Indonesia. Photo by Rhett A. Butler.

Finding win-win solutions

Based on the findings, the researchers have called on the government to boost its efforts in mitigating conflicts by making sure that companies obtain free, prior and informed consent from communities before being allowed to start operating, and by closely monitoring the implementation of the plasma scheme.

And for conflicts that have already arisen, the researchers have called for the establishment of institutions responsible for mediation and conflict resolution at the provincial and district levels. Hermansyah said stakeholders in such institutions would have to include representatives of the communities, businesses, governments, and other organizations.

“It is hoped that the mediation [efforts] from this institution could become a forum for dialogue that can be a more civilized option to resolving conflicts,” he said.

Ana Gustia, an official with the West Kalimantan provincial land agency, said she hoped such an institution could be established in each district in the province to resolve conflicts in a speedy and satisfactory manner benefiting all parties.

“Hopefully we can solve disputes and conflicts so that they don’t have be taken to the court,” she said. “If these conflicts are taken to the court, the process will take a very long time, energy and cost. So if all problems can be solved through mediation, hopefully that’s the best solution.”

The researchers said law enforcement against companies refusing to cooperate should also be strengthened.

“There needs to be more professional law enforcement which is free from any informal pressure from business actors,” Ahmad said.

Heronimus of the plantation agency said district governments, which have the authority to issue permits, can play a key role in this regard by rescinding the licenses of intransigent companies.

“We can evaluate companies [to see] whether they’ve benefitted all parties, which means the firms are profiting, the locals are prosperous and the economy is developing,” he said. “That’s how it’s supposed to be.”

Heronimus added that if companies mistreat communities or fail to communicate properly with them, then district heads can reprimand the firms.

“We understand that the ones whose positions are quite vulnerable are the locals, because the ones with capital are usually the companies,” he said. “From the point of view of the plantation agency, we have to accommodate all conflicts, whether the victims are locals or companies. We must find win-win solutions.”


Banner image: Deforestation for palm oil and mining in West Kalimantan, Indonesia. Image by Rhett A. Butler/Mongabay.


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