InfoSAWIT, DEPOK – After more than a year of researching and delving into various aspects of the palm oil industry, Mutiara Panjaitan, a doctoral student at the Faculty of Law, University of Indonesia, introduced a significant idea during the Open Session for her Doctoral Promotion in Law. The proposal is the establishment of the Indonesian Palm Oil Authority (BOSI), an institution suggested as an integrated solution to various legal, investment, and governance challenges in the palm oil sector in Indonesia.
Mutiara's dissertation, titled "Legal Aspects of Palm Oil Investment: Challenges and Optimizations," was presented before eight professors and doctors. The main promoter, Prof. Dr. Agus Sardjono, S.H., M.H., along with other examiners, including practitioners and representatives from palm oil associations, evaluated the feasibility of this idea.
Three Main Issues in Palm Oil
According to Mutiara, the Indonesian palm oil industry faces three interconnected fundamental problems:
Legal Uncertainty of Land – Approximately 3.3 million hectares of palm oil plantations fall within forest areas, hindering replanting efforts and threatening the sustainability of operations.
Disharmony of Policies Across Ministries/Agencies – A total of 32 institutions are involved in regulating palm oil, often with overlapping regulations.
International Policy Pressures – Discrimination against palm oil products under the guise of sustainability further complicates export challenges.
"The impact of these three issues is significant, ranging from a decline in foreign exchange earnings to disruptions in energy independence programs," Mutiara stated in a statement quoted by InfoSAWIT on Sunday (December 15, 2024). She emphasized that a comprehensive solution is needed to ensure that palm oil remains an economic driver for Indonesia.
BOSI: An Integrated Solution for Palm Oil
Mutiara explained that BOSI would serve as an institution that integrates palm oil management from upstream to downstream. This agency would manage a national palm oil data system, facilitating the government's ability to calculate state revenues.
Additionally, BOSI would establish stable palm oil pricing policies through the Indonesian CPO Exchange and address international pressures through strategic approaches to sustainability issues.
"BOSI will act as a conductor to ensure that all policies operate in sync. Support from President Prabowo is crucial for this institution to be directly under presidential control," Mutiara added.
The palm oil industry has become a vital sector, supporting the livelihoods of 20 million families and contributing up to USD 65 billion in foreign exchange annually. Furthermore, palm oil reduces fossil fuel imports by up to IDR 400 trillion and decreases carbon emissions by 32 million tons per year.
The open session was attended by various stakeholders, including the Chairman of the Indonesian Palm Oil Council (DMSI), representatives from BPDPKS, GAPKI, and palm oil farmer associations. The significant attention given to the BOSI idea reflects hopes that this initiative can bring about meaningful changes in the governance of Indonesia's palm oil sector.
Mutiara concluded her presentation with high hopes, stating, "BOSI will create legal certainty, enhance productivity, and maximize the contribution of palm oil to the national economy." (T2)
