The Indonesian government must restrict foreign ownership in crude palm oil plantations and encourage domestic production, local media reported Monday quoting Hatta Rajasa, the co-ordinating minister for economic affairs.
The government is encouraging CPO producers with foreign ownership to increase the contribution of "plasma" planters, referring to plantations owned by small local landlords who supply to CPO companies, the minister said.
"The plasma scheme must be pushed forward, as it empowers the locals in the sector," he added.
Foreign ownership through subsidiaries, joint ventures and direct ownership accounts for 40% of the total CPO plantations in the country, totaling around 8.9 million hectares, according to official data.
The biggest chunk of foreign investment comes from Malaysia, which accounts for 3 million hectares of plantations.
