How should “projects” be contextualized in the Jatropha sector?

By Henky Widjaja

Quote: However, the definition of ‘projects’ here is crucial: it is a translation of the Indonesian concept of proyek, a delineated set of activities during a fixed and limited period of time for which there is a budget, usually provided by the government.”

 

In Indonesia, the term “project” has a specific connotation. It is usually not a neutral concept of policymaking, as in the standard definition of “a planned set of interrelated tasks to be executed over a fixed period and within certain cost and other limitations” (1). In Indonesia, the meaning of “project” can best be understood in the context of patronage politics. Focusing on this specific connotation helps explain why little attention has been paid to fostering a market for jatropha, and why there has been so little long-term financing of jatropha projects (2). This article argues that the common understanding of Indonesians of the term “project” has shaped the strategy and behavior of actors in jatropha projects. In the Indonesian context, a project is commonly associated with opportunities to benefit from mark-ups or corruption. Edward Aspinall (3, p. 30) notes that in Indonesia, virtually anything can be “projectized” (diproyekkan) – turned into a project and used for the private gain of nimble and inventive political operators.

This article discusses how the term “project” has been translated into practices by actors in various jatropha projects in South Sulawesi. The analysis is based on qualitative research data collected from 12 jatropha projects (Table 1). The interview questions centered around the motivations for establishing jatropha projects (why) and the operation of these projects (how), including the implementation of project design and the reactions of farmers. A first finding from the field research was that the term “project” does not necessarily refer to establishing a whole jatropha value chain. Instead, it has been used for a wide array of limited jatropha-related activities that cover only part of such a value chain.

The 12 projects observed consist of four commercial jatropha projects, one pressing-machine developer project, two seed and seedling supplier projects, two corporate social-responsibility-based jatropha projects, two government jatropha projects and one university-based jatropha research project. These projects were implemented during the period of 2006-2011, and most of them had been terminated at the time of this research. The research suggests that the overall motivation for the emergence of these projects was driven by the high expectations of jatropha becoming a high-value biodiesel alternative and the availability of a large amount of funding from investors, companies and governments for various jatropha-related projects.

The research points out that while there were high expectations of jatropha, the reality that jatropha was not yet a commercially proven crop (4) made actors very cautious about getting involved. Formal project proposals mentioned well-established business models for collaboration between companies and farmers (such as “nucleus-plasma,” land-leasing agreements and joint ventures). However, in the implementation of the projects, activities were predominantly guided by the informal common understanding between the project actors that their cooperation was just a proyek or a pilot project, emphasizing its short-term and trial nature. This understanding therefore minimized the expectations of the actors, limiting them to the benefits they would gain during the first stages of the project as it had been formally planned, for example, rent for the landowner and wages for the laborers. Furthermore, the common understanding of the short-term and trial nature of the project made it easier for the actors, especially the project partners (specifically the farmers and workers), to accept and agree upon the sudden termination of the projects for a variety of reasons, including the absence of a market, subsidies and additional funding. Against this background, this research argues that the word “project” has been translated as a type of business model for testing jatropha on the ground, and has been instrumental in companies or research institutes testing jatropha in field settings in a way that transferred the costs and risks to others, especially to the farmers.

Young jatropha fruits. Photo: Henky Widjaja, 2011

Young jatropha fruits. Photo: Henky Widjaja, 2011

The research also confirms that the term “project” in jatropha projects has been widely translated in the way Indonesians in general define proyek, as a window of opportunity to benefit from the available funding. Such opportunities occur for those involved in the management of the projects (corruption, mark-ups) and for input and machinery suppliers or project beneficiaries. In most of the cases observed in this research, the opportunities were created through a variety of networks – mostly political – to influence a policy or decision by using various positive discourses relating to jatropha at that time. As noted by Vel and Nugrohowardhani (5, p. 33), a policy comes with a budget, and many of the actors observed were able to access budgets for their projects by influencing policy through their networks, such as the jatropha research in the local university, and the CSR (corporate social responsibility) projects.

Villagers hired as daily laborers are filling the polybags for jatropha seedlings, in Bone District, South Sulawesi. Photo: PT JOP, 2007.

Villagers hired as daily laborers are filling the polybags for jatropha seedlings, in Bone District, South Sulawesi.
Photo: PT JOP, 2007.

Some actors also used the positive discourses on jatropha (a solution for the fuel crisis, environmental rehabilitation and income generation) as a basis to approve budget allocation or to attract investment for their projects. The tendency to pursue short-term benefits from the projects was confirmed by findings on corruption in the jatropha projects run by government agencies (for example, a provincial agency that received multi-year funding to establish model gardens, where the implementation appeared to be fictitious) as well as in the commercial jatropha projects, where the managers used the projects as opportunities to extort money from their own ventures.

After the company's liquidation in 2009, the former PT JOP office building in Makassar now hosts the provincial secretariat of the Hanura Party, a café and a travel agency.  Photo: Henky Widjaja, 2011.

After the company’s liquidation in 2009, the former PT JOP office building in Makassar now hosts the provincial secretariat of the Hanura Party, a café and a travel agency.
Photo: Henky Widjaja, 2011.

Not only businessmen and government officials but also farmers translated jatropha projects as windows of opportunity, especially for short-term financial benefits. That response to jatropha projects has been widespread in South Sulawesi, and became a critical cause of jatropha failure in the area. The analysis of the participation of farmers in the jatropha projects observed shows that it was mainly driven by the fact that they could receive various “incentives” (agricultural inputs and some cash), and was not based on their intention to cultivate the crop.

References

  1. http://www.businessdictionary.com/definition/project.html (accessed October 21, 2013).
  2. Anne-Claire Degail, “Developing jatropha projects: Eco-Carbone’s experience,” Eco-Carbone, October 24, 2012. Available at http://biofuelexperts.ning.com/page/developing-jatropha-projects-eco-carbone-s-experience (accessed December 12, 2012).
  3. E. Aspinall, A nation in fragments: Patronage and neoliberalism in contemporary Indonesia. Critical Asian Studies 45(1), 27-54 (2013).
  4. D. Hawkins, Yingheng Chen, “Plant with a bad name” (Hardman & Co, March 2011).
  5. J. A. C. Vel, Respati Nugrohowardhani, “Plants for power: The potential for cultivating crops as feedstock for energy production in Sumba” (HIVOS, 2012).

Annex

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How should “projects” be contextualized in the Jatropha sector? by JARAK the short history of Jatropha projects in Indonesia, unless otherwise expressly stated, is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

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