1. Oil palm development and the challenges for sustainable and equitable growth and forest governance D. Andrew Wardell CIFOR South-South Exchange, 21 September 2011

3. Overview of production and investment trends

4. Governance systems for oil palm

5. Socio-economic impacts

6. Environmental impacts

7. Improving sector governance

8. Securing access to credible information

10. Continued growth in global energy consumption. Energy (in)security and the high cost of fossil fuels

11. Apprehension associated with global warming and efforts to reduce GHG emissions

12. National/regional commitments to promote biofuels. 3 major players – USA, Brazil and European Union

13. Biofuel production trends 2001-09

15. Animal production uses 756 million tons of grain per year

16. 98% of the 225 million-ton global soy crop is fed to farmed animals Sources: Ferrett, G., 27 October 2007; World Bank, 26 August 2008; Singer, P. 2009 all cited in Safran Froer, J. 2009.

18. 80% of GHG emissions – LULUCF, notably conversion of peatlands (total area - 22m ha)

19. Oil palm - 2m ha (2000) grew to 7m ha (2010), projected to grow to between 16.5 and 26m ha by 2020

20. 7 provinces account for 75% of LULUCF emissions e.g. East Kalimantan (86% of emissions but also 30% of GDP and 39% of jobs)

22. Of which for biofuel: US$ 2.0 - 2.7 billion

24. Two-thirds in sugar-based ethanol

26. Maintain supplies for domestic use (pricing, incentives, single-use feedstocks and progressive export tax)

27. Importance of government support both on the production and consumption side

28. Role and effectiveness of government intervention in maximizing benefits of large-scale investments and minimizing costs of sector development

29. Environmental protection

30. SEIA - weak compliance

31. Smallholder participation

32. Enhancing smallholder productivity and market access

33. Mechanisms for FPIC, avenues for legal recourse

34. Land tenure security

36. Fargione et al (2008) estimate 1294-3452 MgCO2/ha total carbon loss  420 to 840 years to recover the ‘carbon debt’ of peatland forest conversion to palm oil

38. Livelihood improvements observed in several sites due to increased incomes and improved access to social services

39. Mixed or negative impacts in others due to poor employment conditions, and not meeting promises or expectations

40. Gains from regularity of income rather than amounts

41. Majority of jobs on palm oil plantations go to ‘migrants’

42. Land losing households

43. Growing landlessness

44. Loss of agricultural and forest incomes from displacement of cropland and forest

45. Additional labour burden due to increased distance of forests and greater dependence on purchased foodstuffs

47. Stronger regulation of large-scale producers (policy orientations, bank credit lines, monitoring)

48. Support to increase smallholder yields

49. Critical importance of full carbon accounting

50. Protection of Vulnerable Groups

51. Controlled expansion of outgrower schemes (legal literacy, contracts, proof of concept)

52. Protection of customary land users: legal protection of rights + negotiation process inc. detailed/written description of benefits and their distribution

53. Leveraging co-benefits

54. Preferential hiring/benefits flows to customary rights holders and land losing households

56. Stimulate responsible investment among pension funds

57. Integrate sustainability issues in bank risk management

58. Make sustainability reporting mandatory

60. Key misconception – “..two thirds of forest clearance is driven by low-income people in poor countries”

61. ‘An Open Letter about Scientific Credibility and the Conservation of Tropical Forests’ (Laurance et al, 25 October 2010) – “…significant distortions, misrepresentations, or misinterpretations of fact.”

62. WGI/ITS fails to comprehend or is failing to convey accurately the real and growing magnitude of industrial drivers as a threat to tropical forests.Laurance, W.F. et al, 2010. ‘An Open Letter about Scientific Credibility and the Conservation of Tropical Forests’. http://conservationbytes.com/2010/10/25/wolvesinsheep’sclothing:industriallobbyistsandthedestructionoftropicalforests/ Oxley, A., 2010. Reaction (to above) from Alan Oxley. Available at: http://conservationbytes.com/2010/10/29/wolves-masquerading-as-sheep/

64. Increase yields by using inorganic nitrogen fertilisers and/or POME as organic fertiliser – in Malaysia required new law prohibiting discharge into waterways

65. Collection of methane from POME treatment – CERs through CDM projects

66. Promote Palm Fatty Acid Distillate-based electricity production? (alternative uses include animal feed and soap industry)Sources: Wicke et al, 2008 and 2011

67. Thank you www.cifor.org