Indonesian Ministry of Agriculture and CSP are Committing to Improve National Cocoa Productivity

Indonesian Ministry of Agriculture and CSP are Committing to Improve National Cocoa Productivity

Jakarta, December 16, 2021—Cocoa Sustainability Partnership (CSP) as public-private partnership forum actively engages in the efforts to improve and develop Indonesian sustainable cocoa sector in Indonesia. This year also is remark that this partnership had worked with the smallholder cocoa farmers in Indonesia for fifteen years. With its members and other strategic partners, CSP had developed various initiatives as efforts in improving national cocoa productivity.

In order to measure success and establish multi-stakeholder coordination, CSP holds General Assembly Meeting three times a year. And at the end of 2021, the participants during CSP General Assembly Meeting discussed efforts to increase national cocoa productivity through a landscape approach in the midst of a sustainable global market. Dr. Ir. Musdhalifah Machmud, MT., Deputy for Food and Agribusiness Coordination, Indonesian Coordinating Ministry for Economic Affairs, as well as chairwoman of the CSP Advisory Board, conveyed how multi-stakeholder collaboration was to increase cocoa productivity in production centers. "Cocoa is one of the most important commodities for Indonesia, especially in the economy. Cocoa is the fourth largest plantation commodity that contributes to the GDP of plantations, which is around 11.2% which shows that the downstream sector of cocoa processing plays an effective role as a leading sector. The contribution of cocoa and chocolate to the economy is 44.5 trillion rupiah," Musdhalifah said. It was also added that CSP was expected to provide its support to synergize the success of government programs. It was recognized that so far CSP had succeeded in helping and fostering farmers, both in providing Subsidized Cocoa-Specific NPK Fertilizer, capacity building for farmers, and credit distribution through Micro Credit Program (Kredit Usaha Rakyat/KUR).

In his remarks, the Indonesian Minister of Agriculture, Dr. Syahrul Yasin Limpo, S.H., M.Sc., M.H. appreciated what CSP had been done so far. And hoped that meetings like this could present recommendations and conceptual ideas on how the government built coordination and synergy with CSP to move forward for the benefit of our cocoa. "Since the outbreak of the Covid-19 pandemic, the government has focused on fulfilling the needs of food for the community. However, in the coming years, the focus will be widened on the plantation sector. Therefore, I am waiting for CSP to provide main thoughts and ideas in order to develop important agendas that will be carried out in an effort to improve the welfare of smallholder cocoa farmers," said the Minister of Agriculture. He also underlined that there were three agendas that must be immediately intervened together. First, how we could carry out replanting by considering national needs and the availability of planting material stocks. It was necessary to determine the area and where the cocoa plantations would be replanted. This effort was believed to be able to meet the needs of the domestic processing industry.

Another problem we face is the capacity of our national budget for this year to only cover about 5,000 hectares, while the need for replanting cocoa plants nationally is at least 250,000 hectares. A lot of the government's budget is absorbed for the provision of vaccines and other managements related to handling Covid-19. Therefore, this effort must be supported by industry parties," he added. Syahrul Yasin Limpo also emphasized that during the replanting period, farmers could be supported by planting intercropping plants that could provide income until their cocoa plants produced. For example, with corn or bananas.

Another agenda that must be considered together was the equal access of cocoa farmers to planting material in the form of quality seeds. Seed sources should be propagated in cocoa development areas nationally. In addition, the quality of the seeds must also be considered.

In addition to the governance issue of cacao cultivation, another thing that must be considered was post-harvest activities. “All of these agendas must be carried out in one comprehensive conception. Therefore, as the Indonesian Ministry of Agriculture are waiting for the contribution of proposals and recommendations from the CSP on how this is implemented,” continued the Indonesian Minister of Agriculture. He also added that of course the state budget would not be able to provide a broad contribution to all farming communities, intervention funding support from the industry and the allocation of micro credit that could be accessed by farmers were also expected to cross-subsidize the funding of these activities.

During the CSP General Assembly Meeting, there were also the inauguration of two initiatives developed by CSP members. The first was the provision of Soil Moisture Index-Based Insurance for Cocoa Plants which was jointly developed by PT. Mars Incorporated cooperates with the Indonesian General Insurance Association and was also directly supervised by the Financial Services Authority (Otoritas Jasa Keuangan/OJK). The second initiative was the digital application of the cocoa cultivation training module using augmented reality and virtual reality by Olam Cocoa Indonesia. These two initiatives were in collaboration with the International Finance Corporation. The inauguration of these two initiatives was carried out by the Deputy for Food and Agribusiness Coordination, the Indonesian Coordinating Ministry for Economic Affairs, together with the Chief Executive of Non-Bank Financial Industry (Industri Keuangan Non-Bank/IKNB) Supervision, OJK Commissioner, Riswinandi Idris.

On the same occasion, Wahyu Wibowo, Executive Director of CSP said that the main focus of the annual plan of this partnership forum in 2022 would place its attention on providing planting material that supported replanting of cocoa plants, providing appropriate fertilizers, providing access to finance for farmers, how Indonesian cocoa in anticipation of European Union policies, decent livelihoods for farmers, initiation of alignment of sustainable cocoa development roadmaps, and also awareness campaigns about sustainability. "We invite collaboration from other parties and CSP members to create a cocoa sector business case that benefits all parties, and active involvement in the previously formed CSP task force to answer all of the challenges mentioned above," said Wahyu Wibowo.

Another focus of CSP in the coming years is the application of a holistic landscape approach that can have the power to increase national cocoa productivity. The action plan that is being developed is that all stakeholders, members and partners of CSP, and the government of course, can join hands and collaborate in improving the welfare of farmers through increasing productivity. (CSP/AH)