02.Social and environmental impacts
Rainforest and animal threats
Widely considered to be the greatest immediate threat to forests and biodiversity in South-East Asia, with the UN Environment Programme (UNEP) predicting that by 2022, the palm oil industry could wipe out 98% of Indonesia’s remaining forests. In Malaysia, from 1990 to 2005 more than a million hectares of forest were cleared for its production, accounting for most of the country’s deforestation during this period.
Plantations are almost always set up on forested land so that companies can also reap the profits from logging. This has caused habitat destruction for a multitude of animal and plant species; research shows that in southern Peninsular Malaysia, conversion of rainforest into oil palm plantations has resulted in a loss of 77% of bird populations and 83% of butterfly populations.
The orang-utan and the Sumatran tiger are the highest-profile species under threat. A 2007 UNEP report suggests that, if the current pressures continue, wild orang-utans will be virtually wiped out within as little as two decades. Sumatran tigers have lost almost half their habitat in the past 10 years, and fewer than 400 survive today.
Clearing and burning forest for oil palm plantations also creates massive greenhouse emissions. This pollution is far worse where plantations are established on peat bogs, which release huge amounts of carbon when drained and burned. Deforestation caused almost 12% of all human-induced greenhouse gas emissions in 2008, and oil palm is recognised as one of the largest driving forces behind this land-clearing.
The threats of deforestation and greenhouse emissions from oil palm plantations are so grave that the World Bank has now suspended lending to palm oil producers until safeguards are developed to ensure lending doesn’t cause further social or environmental harm.
Oil palm agriculture has undoubtedly improved the lives of rural people, including up to six million Indonesians, many of whom were living in poverty. However, traditional landowners are often encouraged to relinquish their land rights when joining an oil palm development and are consequently disempowered in negotiations with palm oil companies.
Health threats faced by plantation workers, include exposure to pesticides as well as chemical pollution of drinking water. Huge quantities of palm oil effluent are produced by processing factories, which can pollute waterways and threaten the health of millions.