Indonesia sharpens axe on land clawback, raising stakes for regional palm oil giants

[JAKARTA / SINGAPORE / KUALA LUMPUR] As Indonesia escalates its sweeping land seizure drive, plantation and mining firms across the region are confronting higher regulatory and financial risks after President Prabowo Subianto said the government could reclaim a further four to five million hectares (ha) this year.

The campaign, which spans hundreds of companies across palm oil, forestry and mining, is raising investor concerns over policy predictability and asset security in South-east Asia’s largest economy, with potential fines running into billions of dollars if disputed land is ultimately deemed illegal.

Jakarta has framed the move – one of the most significant structural shifts in Indonesia’s palm oil and mining industries – as a governance clean-up, with Prabowo seeking to reclaim assets which he said drained billions of dollars from the state through years of improper and illegal licensing.