Obama Didn’t See the Big Picture

THE recent visit to Malaysia by US President Barack Obama drew significant interest – and rightly so. The United States is looking to expand its relations with Malaysia; yet, there was one comment by the US President that was deeply disturbing.

He said, “In Indonesia and Malaysia, what you’ve seen is huge portions of tropical forests that (are)… just being shredded because of primarily the palm oil industry. And there are large business interests behind that industry.” He then went on to ask how we can preserve those forests while using “a different approach to economic development.”

The President’s comments raise three key questions for a developing country like Malaysia.

First, is the President aware that when he says “palm oil industry”, he also means “agriculture and food production”?

Second, is he aware that when he says “there are large business interests”, that there are equal or greater interests from smallholders and family farmers?

Third, is he aware that there is a clear trade-off between forest preservation and economic development, especially for many smallholder farmers?

To the President’s credit, he did state that if you don’t present an alternative for people whose jobs depend on palm oil, they will ignore you. This is true, but what the President either does not know or does not recognise is that for many of Malaysia’s thousands of smallholder farmers, these aren’t just “jobs”.

These are young, fledgling businesses that Malaysia’s new entrepreneurs have been able to start because they own productive farmland. Surely the President of the United States, home of “life, liberty and the pursuit of happiness”, and thousands of family farms across key States like Iowa, would understand this.

President Obama’s seemingly simplistic attitude toward palm oil is indicative of the gap between the perception of the palm oil industry in the West and the complexities on the ground in developing countries.

It is also indicative of the ongoing need for education by Malaysia and other palm oil-producing nations on the social and economic dividend that palm oil provides.

The “No Deforestation” campaign currently being deployed by The Forest Trust (TFT) and Greenpeace is a good example. Major companies such as Unilever, Procter & Gamble and Johnson & Johnson have signed on to commitments that promise “deforestation free” and traceable palm oil in their products.

These companies’ incentive to sign on is straightforward: it’s an easy slogan that Western consumers and campaigners will like. For Western media, “No Deforestation” sounds enticingly simple.

But the slogan leaves out the complexities. Unilever estimates that around 80% of the smallholders that it purchases palm oil from would be “culled” from its supply chain as a result of the new policy.

There are real losers from the new TFT/Greenpeace policy, and they are thousands of small farmers in Malaysia and elsewhere.

The complexities are also historical. Deforestation has gone hand in hand with economic development. “Forest transition” – when a subsistence society deforests as it grows, then gradually reforests as it industrialises – is generally accepted.

Forest historian Michael Williams puts this into context. Between 1700 and 1920 approximately 82 million ha of forest was lost across North America (United States).

Cropland area went from 3 million ha to 179 million ha in the same period.

In Europe, where industrialisation took place earlier, 25 million ha of forest was lost between 1700 and 1850, while cropland doubled from 67 million ha to 132 million ha. In both cases the deforestation rate is higher than current Food and Agriculture Organisation estimates of deforestation in Indonesia – generally considered the highest deforester in the region.

In both cases a significant amount of forest switched to agriculture. This was the Western growth model.

Western politicians and companies that bow to campaign demands now need to recognise that an “alternative economic development model” needs to be real and workable. It can’t just be a simplistic “No Deforestation” slogan, or some snippet White House talking point prepared by left-wing, latte-sipping environmentalists. Such lazy slogans miss the complexities, and often end up being counter-productive for the people on the ground in the developing world.

Palm oil certification – which has for the most part been dismissed by major campaign groups – deals with these complexities.

The Malaysian Sustainable Palm Oil certification standard is a new, government-mandated model that will sit alongside voluntary and other schemes. It will succeed by remaining impartial and apolitical, and putting people first. It is not there to lobby for the wishes of the World Wide Fund For Nature (WWF) or Unilever.

It is not an easy slogan but a well-designed solution. The MSPO standard provides a real answer of how to ensure social, economic and environmental dividends.

Nor is it there to behave like TFT, yet another Western non-governmental organisation – a modern day colonial bully – that seems only interested in looking after relationships between major players – and roundly ignoring Malaysia’s broader economic and social interests.

The newest campaign targets are banks. A coalition of domestic NGOs is calling on Malaysia’s banks to cease financing Malaysian-owned plantation businesses that don’t meet WWF/RSPO/TFT standards. (RSPO is the Roundtable on Sustainable Palm Oil.) What’s next – standards for rubber, tin and pepper plantations? This undermines Malaysia’s National Key Economic Areas, and our efforts to become a high-income country.

So many non-Malaysian actors have attempted to manipulate the country’s palm oil industry – and therefore its national interests – for political and financial gain.

President Obama should not join this chorus. We can only hope he tries seeing things through Malaysian eyes on his next visit – particularly if he’s interested in a broader relationship.


CEO, Malaysian Palm Oil Council

President Obama made some remarks on the palm oil industry while visiting Malaysia recently. Tan Sri Yusof Basiron  explained why  the US President should not join the chorus of voices that are manipulating our national interests.


Source : The Star

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