InfoSAWIT, BANGKOK — Indonesia’s Deputy Finance Minister Suahasil Nazara has called for greater private investment in the palm oil industry to raise plantation productivity, accelerate downstream development and create higher-quality jobs.
Speaking at the Plantation360: Mobilizing Private Capital for More and Better Jobs event in Bangkok, Thailand, on Tuesday, October 13, 2026, Suahasil said investment should reach across the palm oil value chain, including initiatives that strengthen the capacity of independent and partnered smallholders.
The event was organized by EDS16 in collaboration with the Council of Palm Oil Producing Countries (CPOPC).
Suahasil emphasized that palm oil plays a strategic role in Indonesia’s economy, supporting rural livelihoods while supplying raw materials for manufacturing, food production and the energy sector.
Indonesia has more than 16.8 million hectares of oil palm plantations, approximately 41% of which are managed by smallholders. Improving the productivity of existing plantations is therefore a priority, allowing farmers to increase incomes without putting additional pressure on forest areas.
“The important question is not only how much capital we can mobilize. The much more important question is where that capital flows and what results it can deliver,” Suahasil said, according to an official statement received by InfoSAWIT.
Downstream Development and Renewable Energy Offer Investment Opportunities
Suahasil outlined three priorities for mobilizing private capital.
The first is to integrate sustainability into investment decisions while expanding downstream industries. Food products, oleochemicals and biomaterials offer opportunities to generate greater added value, supported by investment in processing technology and product innovation.
Energy-related opportunities include the B50 biodiesel program, green diesel, sustainable aviation fuel (SAF), used cooking oil utilization and farm-based gasoline development.
Diversification into these areas could broaden markets for palm oil derivatives and create new business opportunities throughout the supply chain.
The second priority is to strengthen the role of the government and development finance institutions in making projects investable. Risk-sharing mechanisms, technical assistance and project preparation could help attract private capital for smallholder replanting, supply-chain traceability and downstream manufacturing.
In this context, the Palm Oil Plantation Fund Management Agency (BPDP) supports smallholder replanting, skills development, research and infrastructure. Suahasil said such support should be transparent, targeted and fiscally responsible.
The third priority is to ensure that smallholders become an integral part of the industry’s business models rather than remaining solely suppliers of raw materials.
Better access to financing, technology, knowledge and markets could strengthen farmers’ productivity and position within the value chain.
Balancing Economic Growth and Environmental Protection
Suahasil said higher-value production should go hand in hand with better employment opportunities, improved workforce skills and stronger environmental safeguards.
Potential jobs extend beyond plantations and processing mills to agribusiness, logistics, digital services, engineering and industrial technology.
He also highlighted the importance of credible law enforcement in maintaining sustainable plantation governance. Since February 2025, the Forest Area Enforcement Task Force has brought 6.2 million hectares of forest areas back under state control, including areas previously used unlawfully for oil palm plantations, according to the statement.
Indonesia’s investment strategy, Suahasil concluded, seeks to demonstrate that economic development and environmental protection can reinforce one another.
By directing capital toward productivity improvements, smallholder development and downstream industries, the government hopes to expand the economic benefits of palm oil while strengthening the sector’s long-term sustainability. (T1)
