GREEN ENTERPRISE: SUSTAINABLE LIVELIHOODS FOR FARMERS IN SIMEULUE
PT Green Enterprises Indonesia (GEI) is a farm-to-market foods company - based in the district of Pulau Simeulue, Aceh Province, Indonesia. The company processes premium Virgin Coconut Oil (VCO) through a premium, cold-pressed and entirely raw process, and markets the VCO via its brand “aluan”. GEI maximizes the value added to coconuts in the same place they are grown, supporting communities who depend on coconuts for their livelihoods. Aluan is a word from a rare island dialect and is about your trajectory – a reminder to keep an eye on ourselves and to make good in a world of unsustainable business.
GEI was founded in 2015, and initially started with sourcing coconuts and producing copra for the domestic market. In mid-2016 the company converted its processing plant at Sinabang, Simeulue, to begin producing VCO, coconut chips and associated by-products. The brand aluan was created, with a vision to establish a successful example of sustainable business in Indonesia and beyond.
Social economic and environmental impact
GEI sources coconuts from a total of 2500 hectares of farms, creating employment opportunities and security of income for 320 smallholder farmers (700 hectares) in Pulau Simeulue. GEI aims to increase the number of smallholder farmers, thereby contributing to the livelihoods of over 500 farming families in the coming years.
Environmental impact is achieved by promoting organic farming and only sourcing from certified organic farms. The company achieved European Union (EU), United States Department of Agriculture (USDA) and Japanese Agriculture Standards (JAS) organic certification in February 2017. Through Green Farmer Field schools GEI offers technical assistance to farmers to achieve organic certification, increase agricultural productivity and improve environmentally friendly agricultural practices. The company offers price premiums to community farmers that comply with organic practices and pays at least a living wage to all staff.
The company closes the loop by targeting a zero-waste model. The company utilizes coconut shells for value-added products such as charcoal, liquid smoke and bio-energy, avoiding CO2 and methane emissions that would otherwise arise upon the burning of these waste products.
Around 95 percent of the coconut trees are harvested by smallholders in Indonesia, contrary to the oil palm sector that is fully controlled by large conglomerates. Coconut replanting is urgently needed across Southeast Asia, but is hampered by smallholder farmers’ lack of finance and an absence of collective arrangements. GEI’s integrated coconut replanting and community forest conservation programme addresses the challenges of aging coconut trees and a decline in coconut production as well the direct pressures on forest and wildlife through a community-based model. aluan works directly with coconut farmers to support the establishment of farmer groups.
A large part of the farms are located at 10 pristine uninhabited islands (1800 ha), critical nesting sites for endangered Green Turtles and critically endangered Leatherback Turtles. GEI aims to conserve the sites through a combination of sustainable funding streams for direct conservation efforts (such as ranger patrols) as well as collaborations with government agencies and local and international conservation organisations, including Aceh’s www.haka.or.id.
GEI intends to develop new, modular added-value coconut production and landscape conservation clusters in other areas of Aceh in order to support conservation of the Leuser Ecosystem, the last place on earth where orang-utan, tigers, rhinos and elephants co-exist in the wild.
Through the investment in GEI, C4D Partners aims to increase GEI’s social economic and environmental impact. The company is constructing a new facility where it can gradually grow its capacity from 320 liters a day to 900 liters a day and forecasts to employ 47 people at the factory (50% increase). We believe that GEI gives the local economy an impulse and improves employment at local level, as there is very little economic activity in Pulau Simeulue - and youth are leaving to look for jobs.
Apart from investing financially, we aim to support GEI through our Portfolio Support Program by providing access to our in-house expertise.