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POPULAR REPORT 2010

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In 2010 Indonesia is experiencing a

remarkable economical growth and

increasing involvement in the international

arena. Indonesia is now a member of the

G20 and is also considered to be one of the

new upcoming large economies in the

world (BRICs) . It looks as if the future

becomes brighter for Indonesians.

With this rather positive news about

Indonesia it is also interesting to see what

happens inside the country itself especially

with its people. Domestic spending goes up

markedly and on a tourist island like Bali it

is very clear that ever more domestic

tourists come to the island to spend their

holidays. However, only a few hour’s drive

or short flight from Bali it is easy to see a

totally different Indonesia. Many farmers

lead a dignified but sometimes

economically difficult life and

infrastructure for transport, health and

education are often underdeveloped in

these areas.

Foreword

Content

2. Content

2. Foreword

4. About VECO Indonesia

6. Summary

8. Jakarta

10. Jawa

12. Bali

14. Sulawesi

16. East Nusa Tenggara 1

18. East Nusa Tenggara 2

20. Learning Organisation

22. Finance

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It seems as if the benefits that some

people in Indonesia enjoy from this new

economic momentum are not intended for

most farmers in Indonesia. Indonesia has a

large population, consists of many islands

which are far apart and has major

infrastructural and capacity building

challenges but this is no excuse to leave

farmers outside.

The challenge for family farmers is to get

better access to the economic

opportunities in the agricultural sector so

they can improve their livelihood situation.

VECO thinks that the solution will be to

organize farmers better and build up know

how and experience to do business in name

of their members. This also needs to be

supported by government and private

sector through creating an enabling

environment supporting farmers through

pro-farmer legislation/regulations and

decision making. Another issue is the pull

factor from the markets and finally the

consumers themselves as an important

factor directly related to improving

livelihood of family farmers.

In 2010 VECO-Indonesia and its partners

have helped farmers to create good

business opportunities and to improve

production of Coffee, Cocoa, Healthy Rice

and Peanuts commodities through training

and facilitation of farmer organizations.

Several links were established between

private companies and farmer organizations

leading to a direct business relation

between them (e.g. PT Armajaro/Amanah,

PT Mars/Jantan, PT SBO/ Apolli) . Three

season-long Farmer Field Schools for Coffee

and Cocoa were implemented that trained

farmer organizations how to improve

production. On the consumer front

partnerships were build between consumer

groups and farmer organizations and a

youth focused healthy food awareness

project was started. Further details of

activities conducted by VECO Indonesia and

its partners in 2010 can be found further

on in this annual report.

Wish you good reading and let us know

what you think about our work

Rogier Eijkens

Regional Representative

VECO Indonesia

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About VECO Indonesia

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For more than 25 years, Vredeseilanden

Country Office (VECO) Indonesia has worked

continuously with its partners, including

non-governmental organisations (NGOs),

farmer organisations, national network

organisations, commercial enterprises, and

organised farmers, to achieve one goal: a

better negotiating position for farmers.

This is done through three main programs:

Sustainable Agriculture Chain Development,

Advocacy, and Consumer Awareness.

Like all the networks in West Africa, East

Africa, South America, Central America and

Southeast Asia, VECO Indonesia is under

Vredeseilanden, which is headquartered in

Belgium. In Indonesia, VECO Indonesia

works in six main areas: Greater Jakarta,

Bali, Java, Sulawesi, East Nusa Tenggara 1

(NTT1) and East Nusa Tenggara 2 (NTT2).

All are coordinate from VECO Indonesia

headquarters in Denpasar, Bali.

As well as continuing to work towards

becoming a learning organisation, we are

also busy innovating program strategies

and approaches. In the past, our

intervention focused on the production

aspect of sustainable agriculture. However,

VECO Indonesia is now focusing on

sustainable agriculture practices as part of

an integrated chain. So, we focus not only

on the production aspect, but also on

marketing, political policy, and consumer

awareness.

Through this intervention across the chain,

we work to achieve our goal of a better

negotiating position for farmers.

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The past three years, 2008 – 2010, have

been years of change for VECO Indonesia,

both in terms of organisational structure,

and the programs and strategies for

achieving its goal of a better negotiating

position for farmers. 2010 marked the end

of the internal changes related to the

structure of the organisation and its

functions, which included establishing and

staffing new field antenna.

At the program level, VECO Indonesia

continues with the programs it has run

since 2008: Sustainable Agriculture Chain

Development, Advocacy, and Consumer

Awareness. We also continued to work

towards becoming a learning organisation,

adopting methods that are continually

developing to meet our needs. On the

program partner side, we have shifted focus

from NGOs to farmer organisations.

Throughout 2010, we had to terminate

some of the support programs for NGOs due

both to a lack of progress and to the

switch in our program focus. As a

consequence, we added more farmer

organisations in program locations such as

Sulawesi, East Nusa Tenggara, and Boyolali.

Support for these organisation is provided

through program support, production and

business capacity building, marketing

collectives, and farmer cooperatives.

The number of farmer families supported in

2010 was 17,289, up around 24% on the

total for 2009 of 13,844 farmer families.

This support was given to farmer groups

and NGOs in 12 districts in 7 provinces, as

well as to other stakeholders, including

commercial enterprises and government.

Summary

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To support the second objective, Advocacy,

in 2009, we opened a field antenna in

Jakarta, the capital of Indonesia. Though

the antenna in Jakarta, VECO Indonesia

works with three NGOs – Aliansi Petani

Indonesia (API), Koalisi Rakyat untuk

Kedaulatan Pangan (KRKP), and

Perhimpunan Indonesia Berseru (PIB).

Through API, a national farmer

organisation, VECO Indonesia directly

supported around 8,500 farmer families, as

of the end of 2010. API works to enable

farmers to be more involved in agriculture

policy making, particularly price policy. Its

strategies are influencing policy making

and content based on strong research, and

raising public awareness through media

work. API and its members also mobilise

public support for small scale rice

producers and build alliances with

individuals and civil society organisations

to ensure that that these three strategies

can work effectively.

To communicate its advocacy messages,

API lobbies members of national

parliament, particularly from the Partai

Kebangkitan Bangsa (PKB) faction , and

others such as the ministries of finance,

agriculture and trade. Another strategy is

discussions with mess media on agriculture

policy, particularly rice price policy and

increases in the retail price of fertiliser.

In Jakarta, VECO Indonesia also works with

KRKP on the issue of food sovereignty.

Although based in Bogor, KRKP performs

food policy advocacy not only on a

national scale but also in three regions –

Mamasa, Central Sulawesi; East Flores, East

Nusa Tenggara; and Boyolali, Central Java.

VECO Indonesia also supports PIB to

campaign healthy food through the popular

media Respect magazine. This media

provides alternative information about

healthy food in particular, and about

responsible lifestyles in general.

Jakarta

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In these regions, VECO Indonesia supports

local partners, including the NGOs Lembaga

Sosial Kemasyarakatan dan Bina Bakat

(LKSBB) and Konsorsium Solo Raya (KSR),

and farmer organizations such as Asosiasi

Petani Padi Organik Boyolali (Appoli) . With

LSKBB and Appoli, in 2010 VECO Indonesia

supported 2,863 farmer families as direct

targets of the organic rice chain program.

With KSR, VECO Indonesia campaigned

healthy foods to consumers.

Throughout 2010, VECO Indonesia

facilitated organizational strengthening of

Appoli, particularly in product quality

control through the internal control system

(ICS). VECO Indonesia also facilitated

multi-stakeholder meetings to support the

Boyolali organic rice chain, in particular

assistance with capital, marketing and

technical support, through commercial

enterprises, financial institutions and

government agencies.

This support has motivated Boyolali

farmers to aggressively develop ecological,

environmental-friendly agriculture systems,

including adopting the system of rice

intensification (SRI), and diversifying food

crops to include commodities such as corn,

cassava and tubers. The Boyolali District

Government supports these initiatives

through policy, capital assistance to farmer

groups, technical assistance in production

of organic fertilizer and seed, and outreach

workers. The synergy between VECO

Indonesia and the Boyolali

government has promoted the

use of sustainable and eco-

friendly agricultural resources.

In Solo, VECO Indonesia also

works with KSR, which consists

of LSKBB, Jaringan Kerja

Pertanian Organik (Jaker PO),

and Gita Pertiwi. Throughout

2010, KSR carried out healthy

food campaign activities, among others by

organizing consumer groups, socializing

healthy foods in schools, setting up

organic food kiosks in several locations,

and developing campaign media. As a

result, by the end of 2010, there were 17

consumer groups in Solo and 3 in Boyolali,

with a total membership of around 600

people. There were also 18 organic food

kiosks in these two towns.

Jawa

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Continuing the support give in previous

years through the Bali Organic Association,

in 2010 VECO Indonesia also supported

partner in Bali, Konsorsium Penyadaran

Konsumen Bali. This consortium consists of

BOA, Pusat Pendidikan Lingkungan Hidup

(PPLH) Bali, and Indonesian Development

of Education and Permaculture (IDEP). This

program reaches around 388 farmers and

705 consumers in Bali.

Throughout 2010, the Bali Consortium

conducted health food campaigns through

organized groups. The strategies used

include developing organic food kiosks,

holding routine monthly meetings between

consumers, distributors and producers on a

variety of themes, developing and

distributing information on healthy food,

and strengthening producer farmers to

enable them to supply healthy food

products. The Bali Consortium also runs an

Organic Go to School program at Panjer 4

state primary school in Denpasar, and

organizes healthy food expos where

consumers can try healthy foods for

themselves.

The outcomes of these programs are

Healthy Food Consumer Groups (KKPS)

which will drive the consumer movement in

Bali and introduce healthy food as a local

content subject at Panjer 4 state primary

school, Denpasar. Having organic food

kiosks in Bali has

increased the number

of farmers selling

healthy rice and

vegetables, from 150

to 388.

Bali is also the

location of a new VECO

Indonesia program –

Bali

Healthy Food Healthy Living (HFHL) –

which was rolled out in 2010. Through this

program in partnership with Zuiddag

Belgium, VECO Indonesia encourages young

people to care about healthy food. As well

as through discussions at the monthly VECO

Breakfast Club meetings, the campaign is

also conducted through various media on

campuses and in schools in Bali.

Everything is done by the young people

themselves.

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2010 was the first year of VECO Indonesia

support for cocoa farmers in Polewali

Mandar (Polman), West Sulawesi. The

support is provided through two partners –

famer cooperative centre Amanah and

Wahana Sosial Pertanian Terpandang

(Wasiat) . These two organizations work

with around 1,500 farmers in five

subdistricts of Polman – Tubbi Taramanu

(Tutar) , Luyo, Tapango, Mapilli, and

Anreapi. The cocoa gardens in Polman

cover an area of around 59,000 hectares,

out of a total of 165,000 hectares in the

whole of West Sulawesi. The gardens of the

farmers in the area supported by Amanah

and Wasiat cover a total area of 27,433

hectares.

VECO Indonesia support take the form of

technical assistance, facilitation and

interaction. Technical assistance is

provided on production processes such as

grafting and pruning. Interaction is built to

strengthen solidarity between farmers in

this area, among others through routine

farmer group meetings. Facilitation takes

the form of supporting farmers to prepare

proposals and plan activities. VECO

Indonesia also facilitates study visits by

farmers and partner NGOs to other

organisations that have been successful in

the cocoa chain, and to cooperatives.

The outcome of this support has been a

growth in farmer groups and farmer

cooperatives, at both the village and

subdistrict levels. In December 2010,

Amanah declared itself a farmer

cooperative centre to support the credit

union and multi-business cooperative

enterprises. One impact of the cooperative

is that it is easier for farmers to access

finance for their farming enterprises and

for their household needs. Farmers who had

Sulawesi

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previously had to rely on middlemen, are

now more empowered through their

collectively owned cooperatives. As of the

end of last year, Amanah was managing

funds of around IDR 600 million from

farmer members.

In Sulawesi, VECO Indonesia also supports

partners, NGOs and farmer groups in

Mamasa District, West Sulawesi, and Tana

Toraja District, South Sulawesi. These

partners are Asosiasi Petani Kopi Toraja

(APKT), Yayasan Jaya Lestari Desa (Jalesa),

Yayasan Duta Pelayanan Masyarakat (YDPM)

Mamasa, and Yayasan Komunitas Indonesia

(Yakomi) Mamasa, for the coffee and

vegetable chains. Through support from

VECO Indonesia and its partners, the

farmers are working to increase coffee

production and their standard of living.

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As of 2010, VECO Indonesia worked in four

districts in East Nusa Tenggara (NTT1) –

West Manggarai, Manggarai, Ngada and

Nagekeo – all in the west of the island of

Flores. Here, VECO Indonesia supports local

partners, farmer organisations and NGOs,

such as Yayasan Komodo Indonesia Lestari

(Yakines) and Asosiasi Petani Padi Organik

Lembor (Appel) in West Manggarai,

Komunitas Cinta Indonesia (KCI) and

Delegasi Sosiol (Delsos) in Manggarai,

Persatuan Watuata (Permata) and Lembaga

Advokasi dan Pendampingan Masyarakat

(Lapmas) in Ngada, and Asosiasi Petani

Padi Organik Mbay (ATOM) and Yayasan

Mitra Tani Mandiri (YMTM) in Nagekeo.

Coffee is a major commodity that is

supported because coffee farmers in Flores

face the challenge of low production

volumes and poor coffee quality as a result

of the farmers’ lack of capacity and poor

negotiating position. Through its partners,

VECO Indonesia works to improve coffee

quality through training in post-harvest

management, coffee quality standards,

analysis of the coffee business in a variety

of product types, packaging and labelling.

Other support includes facilitating farmers

in development of collective marketing

associations. VECO Indonesia also supports

field school programs for coffee products in

this area.

One of the outcomes of this support has

been the establishment of a new marketing

system through farmer associations.

Because this shortens the chain, the

farmers get premium prices and sell larger

volumes, and the number of farmers

involved is growing. One Arabica coffee

farmer processing unit gets IDR 6,000 per

litre from PT Indokom, compared with a

market price of around IDR 5,500 per litre.

Another commodity in NTT 1 is organic

rice, in Mbay, Nagekeo and Lembor in West

Manggarai. Throughout 2010, two local

farmer organisations – ATOM and Appel –

continued with the organic farming

practices that they have been employing in

previous years. As well as increasing

production from 3-4 tons per hectare to 8-9

tons per hectare, the farmers are keen to

get organised so they can sell their

products directly to buyers, cutting out the

middlemen. Though their groups, farmers in

these two locations have been able to

improve their welfare.

Nusa Tenggara Timur 1

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Throughout 2010, VECO Indonesia

supported NGO partners and farmer groups

in three districts in East Nusa Tenggara

(NTT) 2 – Sikka, East Flores and North

Central Timor. This support was given to

Jaringan Tani Wulang Gitang (Jantan),

Asosiasi Petani Kakao Nangapenda (Sikap),

Ayu Tani, Asosiasi Petani Bituna, Yayasan

Mitra Tani Mandiri (YMTM) TTU, and

Yayasan An Feot Ana (YAFA) Kefamenanu.

Three commodities supported in NTT2 are

cocoa, cashew and peanuts. In East Flores,

in 2010, VECO Indonesia directly supported

around 2,500 cocoa farmer families. VECO

Indonesia also facilitated cocoa farmers to

be able to sell their products direct toe PT

Mars Symbo Science Indonesia. Since

joining up, farmer members of Jantan and

Sikap have seen their income from the sale

of cocoa increase 8 percent. They get

better prices because the quality of their

cocoa meets PT Mars standards. Production

of cocoa beans has also risen since the

farmers adopted the system of regular

harvesting, fertilising, pruning and

sanitation introduced to them through

VECO Indonesia field schools.

This increase in income has also improved

the negotiating position of farmer families.

As an example, they have been able to

negotiate with government for a cocoa

processing unit. Sikap farmer members, for

example, have secured land use rights for

development of cocoa processing unit in

Nangapenda District. And in East Flores,

through Jantan, for the

2010 harvest season

farmer families

managed to negotiate

prices of between IDR

10,000 and 12,000 per

kilogram of dry beans

with local traders.

In North Central Timor,

2,264 farmer families

are members of 147 farmer groups. All

these farmer groups are members of 14

farmer group associations and have formed

Asosiasi Petani Bituna, which covers 18

villages in this centre of peanut

production. Through this association, the

farmers are not only released from the grip

of middlemen, but also get fairer prices, up

from IDR 3,000 per kilogram in the past to

IDR 10,000 today. Coinciding with this

price increase has been growth in

production, from around 30 sacks per

hectare to 100.

Nusa Tenggara Timur 2

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Organisasi Belajar

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VECO Indonesia continues to be committed

to becoming a learning organisation.

Several initiatives have been launched

towards achieving this goal. After starting

to use online media in 2009, in 2010, VECO

Indonesia continued to make active use of

this media, including websites, intranet,

and social networking, as media for sharing

information among staff and with others.

The online media complement the printed

media that VECO Indonesia produces, which

include the Annual Report, LONTAR

newsletter, and other publications.

2010 also marked the departure of SALAM

magazine from VECO Indonesia. SALAM is

an quarterly agriculture magazine published

by VECO Indonesia in collaboration with

ILEIA Netherlands since 1997. Beginning

early 2010, publication of SALAM was taken

over by another NGO, Aliansi Organis

Indonesia (AOI) Bogor, and given the new

name PETANI, which is published every four

months.

This year, VECO Indonesia and its partners

also published books as learning media.

These included the books

Komunikasi untuk Inovasi

Pedesaan (Communication

for Rural Innovation)

(Kanisius, VECO Indonesia,

and KRKP), Mengubah

Cagar Alam Watuata

(Changing Watuata Nature

Reserve) (VECO Indonesia

and Australian Indonesia

Partnership); the findings

of KRKP research

Kapasitas Tunda Jual Petani Padi (The

Capacity of Rice Farmers to Delay Selling),

Inovasi Pemerintah Daerah dalam

Pembiayaan Pertanian (Local Government

Innovations in Agriculture Financing), and

Kebijakan Harga Beras di Indonesia (Rice

Policy in Indonesia); as well as other

books.

VECO Indonesia also continued with several

new activities to share information. For

example, via the VECO Breakfast Club, a

forum where farmers can discuss healthy

food with consumers. The VECO Breakfast

Club three times in 2010, and majority of

participants were young people. This

initiative is also part of the Healthy Food

Healthy Living (HFHL) program. Another

learning activity in 2010 was the value

chain development workshop with

Horticultural Partnership Support Program

(HPSP), VECO Indonesia, and Cordaid. To

continue learning, VECO Indonesia staff

also participated in internal, regional,

national and international workshops

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DGOS 8,306,981,329 676,671 56%

NOVIB 2,183,159,990 185,439 15%

ILEIA 397,521,644 31,053 2%

MISEREOR 1,638,348,597 141,619 12%

CORDAID 2,132,477,434 180,812 15%

TOTAL 14,658,488,994 1,215,594 100%

PercentageSource of Budget

IDR EuroDonor

Local Partners 8,391,349,802 695,875 57%

VECO Indonesia 6,267,139,192 519,719 43%

TOTAL 14,658,488,994 1,215,594 100%

PercentageAllocation of Budget

IDR EuroTarget

Source of VECO Indonesia Budget's 2010

Allocation of VECO Indonesia's Budget 2010

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To run the programs in 2010, VECO

Indonesia received funding support from

five donors – DGOS, NOVIB, ILEIA, Misereor

and Cordaid. The largest contribution, 56

percent, came from the Belgian

Government through DGOS. Novib

contributed 15 percent, Misereor 12

percent, Cordaid 15 percent, and ILEIA 2

percent. The total budget in 2010 was €

1,215,594 or IDR 14,658,488,994.

This budget was used, among others, to

fund partner programs and VECO Indonesia

program operations. Fifty-seven percent, or

IDR 8,391,349,802, was for local partners

and 43 percent, IDR 6,267,139,192, was

managed by VECO Indonesia.

Finance

Source of VECO Indonesia Budget's 2010

Allocation of VECO Indonesia's Budget 2010

57%Local Partners

56%DGOS

43%Veco Indonesia

15%Cordaid

2%ILEIA

15%NOVIB

12%Misereor

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VECO Indonesia

Jl. Kerta Dalem No. 7, Sidakarya

Denpasar, Bali 80224, Indonesia

Telp. +62 361 7808264, 727378

Fax. +62 361 723217

Email. admin@veco-indonesia.net

Website: www.vecoindonesia.org