IRIM Response to CEO MPOC Tan Sri Dr. Yusof Basiron’s statement

CEO MPOC Tan Sri Dr. Yusof Basiron’s statement said:"If Malaysia aspires to be a developed country, it has to follow other developed countries by reducing its forest to a more sustainable ratio such as 33 per cent. It gets no reward or compensation for maintaining more than 50 per cent of its land as forest. Such moves hamper the country's effort to become a developed nation as it is not able to unlock its national land assets as practiced by other developed countries." - (NST 4 November, 2012).

Responding to CEO MPOC Tan Sri Dr. Yusof Basiron's statement on the oil palms' "invasion" of the natural forests, the President of the IRIM (The Malaysia Institute of Foresters), Dato' Prof. Dr. Hj. Abd. Rahman Bin Hj. Abd. Rahim said: “This is a baffling set of statements.  Coming from the head of MPOC (the Malaysian Palm Oil Council), it is all the more bizarre, ... rather unbelievable. We can only speculate that the Malaysian oil palm industry has been under continuous pressure from environmentalists the world over, with criticisms pointed at oil palms' "invasion" of the natural forests - in this instance, Malaysia's much valued rainforests."

"This has led CEO Tan Sri Dr. Yusof Basiron to react, often branding the attacks as competitors' smear tactics. "

"It was probably in that sentiment that Tan Sri Yusof made those remarks in NST.  But to readers in this country, the comments reflect negatively on his thinking. To foresters, this is preposterous. They view this kind of disposition as sectoral mind-set where oil palm is seen The savior to the nation's economy and that oil palms should replace forest, and do the job." 

IRIM's concern

"MPOC is obviously indifferent to the non-monetary, biodiversity wealth of our natural forest and the environmental services it provides. His view that forests are less worthy than oil palm does not take into account those attributes. The universal call: "Save the Rainforest" is construed as a subtle move to stop Malaysia from advancing its economy, rather than a precautionary appeal to maintain its already fragile ecological balance."

"We, at IRIM (Institut Rimbawan Malaysia) must express consternation about Tan Sri Yusof's stand that the country needs to reduce forest cover to a third of the country's land area because having half of the country under forest today "hampers" national development. So, forests are antithesis to national development! This is a sad indictment.  But the premise simply does not hold water.  We are not convinced that Malaysia will effectively emerge as a developed country by "unlocking its national land assets" to oil palm as the case of the now developed nations."

"Europe lost most of their forests during Industrial Revolutions two-three centuries ago, and America, during 1820-1870. To suggest that Malaysia emulate developed countries and remove most of its forests is to send us back to the poverty days of Europe centuries ago. We have cleared enough forest for FELDA in 1960 - 1970s to raise the economy of the rural people. If grand deforestation does take place again, it will have little to do with eradicating poverty."

"True, oil palms have great capacity for carbon adsorption, just as other vigorously growing tree crops. But the process of establishing plantation, especially the large scale burning of peat forests, scientists claim, will release billions of tonnes of carbon, contributing to global warming. The same area will be due for replanting and a repeat session of carbon emission, even before the crop can make up for the previous pollution."

Lacking in congruence

"MPOC's ideas about deforestation are incongruous with government's aspirations under ETP whose primary aims is making Malaysia "a high-income nation that is both inclusive and sustainable by 2020." Sustainable growth is about "meeting present needs without compromising those of future generations." It must be stressed here that "present needs" should not be interpreted as merely economic needs. High-income status is to be achieved in balance with the security of the natural environment. " 

The ETP adds: "In economic terms, growth will have to be achieved without running down Malaysia’s natural resources..... In environmental terms, the Government is committed to the stewardship and preservation of our natural environment and non-renewable resources. The Government will ensure that environmental resources are properly priced and that the full costs of development are understood before investment decisions are made."

"The 33 per cent forest cover suggested by Tan Sri Yusof as "sustainable" level, for Malaysia is way below the government's declared 50 per cent forest cover made during the 1992 Earth Summit, and again at the 2009 Copenhagen Accord."

Capital for development

"In today's competitive and high-technology world, Malaysia continues to be over reliant on natural resources as capital for economic development. ETP works towards overcoming this weakness. In line with the more progressive economies it encourages the use of alternative capital assets such technology (electronics), intellectual prowess (R&D, innovation), talent and acumen. (There are still many young Malaysian graduates who prefer to stay behind in the countries of their studies, or work elsewhere, because of lack of demand here for their acquired expertise). " 

"Europe and America went through the deforestation process in Industrial Revolution times because they had no option but to use land as capital for development. With the availability of today's technology and infrastructure would they ever think of devastating their forests for development? In our case, today we have the choice.  We are in the world of science and technology, we have entrepreneurs and well trained and educated human capital, and we have local and foreign financial resources besides our own natural resources. In other words, we have several different means to help build the economy. Why do we need to repeat what Europe and America did to their forests? "

A growth engine and its challenges

The oil palm industry is one of the eleven industries selected as the growth engines of the ETP. They are identified in the ETP as the National Key Economic Areas (NKEAs).  

"The oil palm plantation industries of Malaysia would know better:producing for export palm oil for domestic use has a limited future in view of the pending competition from Indonesia's massive expansion programmes. Reluctance of owners of local producers to do replanting for reasons of temporary loss of income will not help with improving productivity. Malaysia is losing out to Indonesia in the fundamentals: production cost and volume of output per hectare (Indonesia has better site qualities in terms of topography and natural soil fertility) and huge capacities for expansion."

"The key growth factors that point to Indonesia's advantage for example are the obvious availability and lower cost of labour, Malaysia's minimum wage policies for labourers which are going to hit the industry hard, and not the least, the returning to Indonesia of now higher skilled workers, with prospects of higher positions, having benefited from their experiences in Malaysia. "

"Apart from increasing FFB yield and speeding up replanting when replanting is due MPOC is presumably focusing on maintaining the quality of products in hand, and stepping up efforts to create value-added products, such as bio-fuel, and by-products such as oleo derivatives, and perhaps "new" non-oil products based on oil palm fibre."

"MPOC is already heading in this direction. In other words, the strategy option for the future is downstream.  By opting to turn away from clearing new areas of forest land, MPOC will be making significant contributions towards the conservation of the country's forest ecosystem."

Conclusion

"The oil palm industry leadership at MPOC knows best where its competitive strengths and advantages lie.  At IRIM we feel that increasing production of palm oil may not necessarily be the best way to combat threats of competition.  A commodity price war with Indonesia will be an exercise in futility. Moral elements need to be taken into account. Further deforestation for economic benefits must not ignore the burdens to future generations of ecological losses."

"On the other hand, taking the leadership in raising the value chain through technology and scientific research is the logical step to take for the industry. It is a case of developing a variety of value added or "new" high quality products as opposed to producing palm oil as purely a commodity item. Modern day palm oil research and management will help strike a balance between profitability and security of the environment."

"We need government's help to resolve this palm oil - forest conservation conundrum perhaps through multi-stakeholder dialogues with discourse on environmental economics and natural resource management, to ensure sustainable development is achieved for posterity. In protecting the environment, Government ought to institute strong policies that will require factoring the ecological values into economic considerations in all cases of land use."

"In seeking harmony of man with nature, the government needs to weigh a situation much more deeply than the traditional throwing of ready-made policy dices. A revisit of existing land use policies is needed. Past decisions based on the simple guidelines of the much outdated Second Malaysia Plan (1970) LCCS (Land Capability Classification Survey), has cost the government incalculable losses of valuable forest land or devastation of ecologically vulnerable sites. Natural resources are getting scarce."

"We need to allow the Precautionary Principle to stand out as a point of reference before arriving at decisions on land use. This is crucial. We do not want to reach a point of time when people are telling us that we are no longer capable of meeting the needs of future generations."

"Forestry and oil palm industry must not be opponents, but instead, exponents in matters of balanced use of natural resources while securing a foundation for sustainable economic development. Minor forest produce, pharmaceutical plants on one hand and palm oleo derivatives, palm fibre and mill wastes, all have potentials to offer economic benefits to mankind - perhaps much more than what we know today. As responsible citizens, people in forestry and the oil palm industry can work hand in hand in optimising the use of natural resources before them while assuring continuity of benefits to posterity.”