JAKARTA : “Indonesia Uses Palm Oil Fund for Cocoa, Coconut Sectors”,Indonesia plans to use funds from its palm oil export levy to finance development of the country’s cocoa and coconut sectors, the country’s trade minister said on Wednesday.
The world’s biggest palm oil exporter has since 2015 collected a levy to fund its palm oil biodiesel mandate, smallholder replanting programme and palm oil research.
“Initially we planned for separate agencies for cocoa and coconut, but it has been decided to merge them with BPDPKS,” Trade Minister Zulkifli Hasan told Reuters. BPDPKS refers to the country’s agency in charge of collecting a palm oil export levy and disbursing the fund.
“It will be a cross subsidy, for cocoa and coconut development, nursery and seedlings from (the crude palm oil levy),” he said.
Indonesia currently imposed a 0-15 per cent export tax on cocoa beans, which the government will assign to BPDPKS to collect and manage, coordinating minister of economics Airlangga Hartarto said.
Zulkifli said the plans would be implemented soon and the agency has sufficient money so there was no need to impose an additional levy on cocoa and coconut producers.
In a statement, the industry ministry said the plan was needed to ensure security of supply, with cocoa output in the 2015-2023 period shrinking by 8.3 per cent annually.
Indonesia was the world’s fourth-biggest exporter of cocoa products last year, though had to import 62 per cent of the cocoa beans needed, the ministry said.
Indonesia’s smallholder palm oil group APKASINDO urged the government to reconsider its plan and said there was not yet enough funding for palm oil farmers.
