KEM Pushes for Strengthening the Value Chain of the Indigenous Forest Economy to Improve Community Welfare
JAKARTA - The Koalisi Ekonomi Membumi (KEM) encourages the strengthening of the value chain of the customary law community (MHA) economy to ensure that the management of customary forests does not only stop at administrative recognition, but also has a real impact on community welfare and forest sustainability.
The impetus emerged in the National Workshop after COP30 in Belém, Brazil, which was held by the Ministry of Forestry (Kemenhut) on January 17-18, 2026 in Jakarta. This activity is a follow-up to Indonesia's commitment in COP30 as well as part of efforts to accelerate the national target of establishing 1.4 million hectares of customary forests.
During the forum, the Ministry of Finance explained the Roadmap for Accelerating the Determination of the Status of Indigenous Forests which places MHA not only as forest guards, but also as sustainable natural resource-based economic actors.
KEM Executive Director, Fito Rahdianto, emphasized that strengthening the economic aspect is the key to ensuring that the recognition of customary forests has a direct impact on improving people's welfare.
"Improving the welfare of MHA requires stronger connectivity with the national and international economic value chain. Without it, indigenous people will continue to be in a weak position as suppliers of raw materials without market certainty and bargaining position," said Fito.
He assessed that until now MHA is still facing various structural obstacles in the economic value chain, such as limited production and processing capacity, lack of access to financing, to dependence on middlemen. In fact, the economic potential of customary forests - from non-timber forest products, agroforestry, environmental services, to local knowledge - is considered to have great opportunities to provide more equitable added value.
The workshop also highlighted the social and ecological risks that need to be anticipated in the development of the customary forest economy, including land tenure conflicts, gender inequality, to the risk of excessive exploitation when a commodity is commercially successful. Therefore, the application of the social and ecological safeguard principles is considered crucial in every partnership with the private sector.
In the panel discussion, EcoNusa CEO Bustar Maitar emphasized that the development of an economy based on customary forests, especially in eastern Indonesia such as Papua and Maluku, requires a different business approach from the conventional pattern.
"Through the KOBUMI scheme, we are building a market and price guarantee mechanism that is fair, where indigenous people have certainty of purchase, cash payment, and ownership in the value chain. This model has proven to be able to drive the growth of the indigenous forest-based economy," said Bustar.
Meanwhile, Director of PT Sosial Bisnis Indonesia (SOBI), Matt Danalan Saragih, highlighted the importance of long-term partnerships and strengthening the product traceability system so that MHA commodities are able to penetrate a wider market.
"The main problem in developing community-based value chains is consistency in supply and quality. Through the development of agroforestry hubs and global standard traceability digitization, MHA products can have stronger competitiveness," he said.
Deputy Minister of Forestry Rohmat Marzuki emphasized that the establishment of customary forests is a first step towards strengthening the economy of indigenous peoples. According to him, this policy must be accompanied by efforts to improve welfare in line with local wisdom.
As a follow-up, KEM initiated the mapping of the potential of customary forest products and services as well as the need for priority interventions to strengthen sustainable and equitable economic value chains.
This step is expected to open up opportunities for cross-sector collaboration in promoting the economy based on customary forests as part of the national green development agenda.