<p>ABSTRACT<br />The expansion of oil palm plantation is a necessity in Indonesia. The global market demand pressure and the need to accelerate national economic growth have supported the occurrence of massively expansion of oil palm plantation in Indonesia. Although it contributes many benefits from the economic side, but in another side, the oil palm plantation also gives social and environmental impacts. Such impacts are, among others, such as the changes of agrarian structure, land dispute, livelihood system of rural household, lack of biodiversity, crop monoculturalization, and deforestation. This research is aimed to describe socio-economic impacts caused by the expansion of oil palm plantation toward the livelihood system of rural household. By using livelihood survey and deep interview, this research obtains a fact that the oil palm plantation has, as if, provided prosperity for the rural household, but what really happens is high process of livelihood vulnerability and dependency toward income gained from the salary in oil palm plantation.<br />Keywords: Oil palm, livelihood, dependency, and vulnerability</p><p><br />ABSTRAK<br />Ekspansi perkebunan kelapa sawit merupakan suatu keniscayaan bagi Indonesia. Tekanan permintaan pasar global dan kebutuhan untuk memacu pertumbuhan ekonomi nasional mendorong terjadinya ekspansi perkebunan kelapa sawit secara masif di Indonesia. Meskipun memberikan manfaat dari sisi ekonomi, di sisi lain perkebunan kelapa sawit juga memberi dampak sosial dan lingkungan. Dampak tersebut diantaranya seperti perubahan struktur agraria, sengketa lahan, sistem nafkah rumah tangga pedesaan, berkurangnya biodiversitas, monokulturisasi tanaman, hingga deforestasi. Penelitian ini bertujuan memberikan gambaran dampak sosial-ekonomi dari ekspansi perkebunan kelapa sawit bagi sistem nafkah rumah tangga pedesaan.Dengan menggunakan survey nafkah dan wawancara mendalam, penelitian ini mendapatkan fakta bahwa perkebunan kelapa sawit seolah memberikan kesejahteraan bagi rumah tangga pedesaan, namun yang terjadi adalah proses kerentanan dan ketergantungan nafkah yang tinggi terhadap pendapatan dari upah perkebunan kelapa sawit.<br />Kata kunci: Kelapa sawit, nafkah, ketergantungan, dan kerentanan</p>

Nowadays, Indonesian palm oil faces agrarian, environmental, and social issues and has been subject to sharp criticism from the international community for many years. To answer this problem, the Indonesian government implemented a strategy through certification which ensured the achievement of sustainability standards, especially on the upstream side of the palm oil supply chain. The implementation of Indonesian Sustainable Palm Oil (ISPO) was an ultimate instrument that applied in particular to smallholders oriented towards managing land legal issues, plantation business licenses, plant seeds, and environmental management and to farmer organizations at the local level. However, this process faced quite complex challenges in the form of structural barriers that are very constraining. This study revealed the occurrence of the phenomenon of hollow governance when regulations are absent or collide with each other. The study also revealed institutional power and multi-level governance that made the governance process ineffective or counterproductive. With a qualitative approach to research conducted in three important palm oil provinces of Indonesia, this article aims to look at the issues of oil palm governance a bit more comprehensively. The study conceptualized what was referred to as low-functioning governance to describe how weak the institutions, organizations, actors, and resources are that support ISPO implementation, especially at the regional and local levels. This paper suggests improving and strengthening the ISPO oil palm governance if Indonesian palm oil companies and smallholders want to gain better credibility on sustainability abroad.

The expansion of oil palm plantation has caused adverse impacts on the ecosystem. It has been associated with deforestation, biodiversity loss, disturbances to environmental services and livelihood change. The government of Indonesia has made an effort to control the negative effects by issuing relevant policies. One of the policies is Indonesian Sustainable Palm Oil (ISPO)’s sustainability standards to which large-scale plantations and smallholders are obliged to adhere. This study assesses the readiness of two types of smallholders, namely, the nucleus–plasma scheme and independent smallholders to adopt ISPO standards. Using a case study research approach in two oil palm plantation villages in East Kalimantan, the study found out a number of ISPO implementation challenges, grouped into structural and socio-cultural challenges, which make smallholders less ready to adhere to this mandatory policy. Coping with these challenges, this study proposed that land and business legality programs be expedited to strengthen property rights, and that training and education programs be intensified to enhance awareness, knowledge and capacity of smallholders to enable them to comply with sustainability standards.

The Expansion of oil palm plantations is often performed on a large scale of the state front stage, carried out through the operation of big capital, supported by licensing documents and using the legal basis of the state law in the form of land cultivation right (hak guna usaha). This phenomenon is an expansion of oil palm plantations which have been understood by the public as a form of open expansion. This research is using a mix of qualitative and quantitative methods which have found that there had been an expansion practice in other form, namely the silent expansion. This silent expansion is a form of tragedy of access where actors can establish oil palm plantations without the bundle of rights that are legal, but using a bundle of power behind the failure of state control over state property right. The expansion is done quietly, under-the-table, within a small area, without legal permit documents. In the final section, this paper describes the institutional response to the problem of silent expansion using formal policy instrument approach.

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