President Joko Widodo has signed a Presidential Instruction that puts a three-year ban on palm oil plantations licenses, a move that is unlikely to be popular among the palm oil industry, one of the most influential industry in Indonesia.
The Presidential Instructions also put in motion a thorough review on existing palm oil licensing data by both the central government and local governments. The policy’s implementation will be reviewed every six months by the office of the Coordinating Minister for Economic Affairs.
The freeze will provide supports to the price of palm oil as freeze on new plantations will limit supply of the commodity. According to the government’s data, the land area of palm oil plantations reached 14.03 million hectares by the end of 2017, rising from 11.90 million hectares by the end of 2016.
The freeze came on top the already implemented ban on forest clearing until 2019, which was first introduced by the previous President Susilo Bambang Yudhyono in 2011.
