Malaysian Palm OilPalm oil is the world’s highest-yielding vegetable oil and Malaysia’s third highest-yielding export. For many smallholders in Malaysia, it is also a means of escaping poverty. However, Malaysian palm oil smallholders are facing both domestic and international pressure to improve their sustainability credentials. 

Oil Palm: The Money Tree

Malaysia is one of the largest palm oil producers in the world, second only to neighboring Indonesia. Smallholders, farmers who cultivate oil palm areas of less than 50 hectares, account for 40% of palm oil output in Malaysia. Since the 1960s, land conversion schemes run by the government’s Federal Land Development Authority (FELDA) agency have supplied smallholders with land to grow oil palm. These schemes have successfully reduced the poverty rate among smallholders by 90% (from 50% to 5%).

Oil palm cultivation has been an unprecedentedly effective means of reducing poverty. However, even today many Malaysian palm oil smallholders have average incomes below the national poverty line. These farmers and their families experience poor social and environmental standards as a result. 

The Push for Sustainability

In 2013, the Malaysian government set up the Malaysian Sustainable Palm Oil (MSPO) standard to regulate the Malaysian palm oil industry. Since 2020, smallholders have been required to have MSPO certification, which aims to improve management practices and reduce the risk of threats to biodiversity, like land conversion. In 2021, the Malaysian government provided 20 million Malaysian Ringgit (RM) to help smallholders acquire MSPO certification. However, mandatory sustainability certification requirements have increased smallholders’ financial burdens, compounding existing problems such as expensive land tenure and limited market access.

The EU Regulation

Malaysian palm oil smallholders are also facing international pressure to improve sustainability. In December, a new EU regulation banned imports of commodities grown on land deforested after 2020. Malaysia — along with Indonesia — has accused the EU of blocking market access for their palm oil and threatened to stop all exports to the economic bloc. In a joint statement, a group of six smallholder associations from both countries said that the EU’s “unrealistic demands on traceability and geolocation” could deny smallholders market access.

Historically, oil palm plantations have replaced swathes of forest and more diversified cropland in Malaysia. According to a study published in January 2023, oil palm is one of the “main crops threatening biodiversity and natural habitats in Southeast Asia” along with rubber. Malaysia’s national sustainability certification program was partly meant to assuage international fears about the deforestation risk associated with palm oil. And although the EU’s new regulation has the potential to harm the income of Malaysian smallholders, it should be considered in the context of Malaysia’s export markets. In 2022, the EU accounted for only 9.4% of Malaysia’s palm oil export volume. 

Looking Ahead

In the face of domestic and international pressure, Malaysian palm oil smallholders are taking steps toward improving their sustainability practices. The Malaysian government’s establishment of the Malaysian Sustainable Palm Oil (MSPO) standard and financial support for smallholders to acquire certification demonstrates the commitment to enhancing management practices and protecting biodiversity. While challenges remain, including financial burdens and market access limitations, there has been progress toward a more sustainable palm oil industry that can benefit both smallholders and the environment.

– Samuel Chambers
Photo: Flickr

Crisis in VenezuelaIn March 2013, after a 14-year rule, Venezuelan President Hugo Chavez died of cancer. He was succeeded by Vice President Nicolas Maduro. Since then, the oil-rich but cash-poor South American country has been in a political and economic crisis. Here are 10 things you should know about the crisis in Venezuela.

10 Things to Know About the Crisis in Venezuela

  1. Inflation rates are at an all-time high. The biggest problem in the day-to-day lives of Venezuelans is due to the record high inflation rates. Throughout the Chavez presidency, the inflation rate had fluctuated between 10 and 40 percent but never higher. Since Maduro took office inflation rates have grown exponentially. In 2018, the inflation rate hit 1.3 million percent and is projected to reach 10 million in 2019. With inflation being so high, it becomes impossible for Venezuelans to buy basic necessities.
  2. Minimum wage is as low as $6 a month. On top of the high inflation rate, the minimum wage is now $6 dollars a month. Nearly 90 percent of the country’s population is living in poverty and unable to buy basic goods. Additionally, the number of active companies in Venezuela has dropped dramatically, minimizing the number of jobs available to citizens.
  3. More than 3 million people have fled the country. Over the last five years, the crisis in Venezuela has forced more than 3 million people out of their homes. Most of these refugees have claimed that the lack of rights to health and food were among the main reasons for them to leave. These migrants, who made up roughly 10 percent of the Venezuelan population, have fled to neighboring countries including Chile, Colombia and Brazil.
  4. There are currently two presidents. Since 2019 started, political tensions in Venezuela have escalated. In early January, President Nicolas Maduro was sworn in for a second term, following an election period of boycotts and opposition. The results of this election led to a new wave of rallies throughout the streets of Venezuela, particularly the capital city of Caracas. These boycotts culminated with the elected leader of Venezuela’s National Assembly, Juan Guaido, naming himself interim president.
  5. The rest of the world is very split over who to support. The most unique part about Guaido declaring himself interim president is that several countries around the world immediately acknowledged it as legitimate. The United States, much of Europe and several South American countries recognize Guaido as the rightful interim president of Venezuela. However, Russia, China and most of the Middle East still recognize Maduro as the president. Additionally, some countries, including Italy, are calling for a new election to determine the rightful president.
  6. Oil output has declined dramatically. Venezuela has over 300 billion barrels of proven oil reserves, making it a leader amongst the world’s oil-rich countries. Oil production dropped in 2002 after Chavez was first elected, but soon after, it rose back up to regular rates and has been steady since. Since 2012, however, there has been a consistent decrease in oil output. In January 2019, President Trump announced that the U.S. will not import oil from Venezuela for the time being, in hopes that economic pressure will lead to correcting the political crisis.
  7. There have been countless mass protests across the country. The crisis in Venezuela has sparked riots and rallies across the whole country. In 2018 alone, there were more than 12 thousand protests, according to the Venezuelan Observatory of Social Conflict. These protests, starting in 2002 after Chavez came to power, have only escalated in violence since.
  8. Officials have resorted to excessive use of force. In April of 2017, Maduro ordered armed forces to put a stop to what had been weeks of anti-government protests. In the two months to follow, more than 120 people were killed, 2,000 were injured and more than 5,000 were detained. Since then, multiple citizens have been killed or injured when police and protesters have clashed.
  9. Maduro’s administration denies that it is in a human rights crisis. Despite the statistics pointing to the crisis in Venezuela, Maduro and his administration have not acknowledged the human rights crisis. Additionally, the administration has not recognized the shortages of food and medication, and, as a result, it has not accepted international humanitarian assistance. Despite the lack of official recognition, the current state of Venezuela has been regarded as the worst humanitarian crisis in recent memory in the Western Hemisphere.
  10. The crisis is taking a toll on the overall health of the country. Since 2014, the number of malaria cases in Venezuela has more than quadrupled. After years of remaining steadily below 100 thousand cases, there are now more than 400 thousand people living in Venezuela with malaria. This is because there is a dramatic shortage of anti-malaria drugs for all strains. Medical facilities are struggling with a shortage of 85 percent for medications. At least 13 thousand Venezuelan doctors were among those who have fled the country. A lack of proper medical care is making the people of Venezuela more susceptible to treatable diseases such as tuberculosis.

The crisis in Venezuela is worsening by the day. There are countless people being forced to leave their homes, jobs and families in hopes of finding a safer place to live. While the country awaits political intervention and foreign aid, there are still ways for people overseas to give help. Many nonprofit organizations, including The Better World Campaign, are doing their part in helping the humanitarian crisis. These groups are always looking for volunteers and donations. Spreading the word about the situation in Venezuela, raising awareness and mobilizing others to donate is also a great way to help, even from afar.

Charlotte Kriftcher
Photo: Flickr