Ex Indonesian trade minister calls on S'pore to scrutinise S'pore companies that control land concessions

A former Indonesian trade minister Muhammad Lutfi has taken to social media to criticise Singapore and Malaysia's responses regarding the role of Indonesian companies in what is turning out to be the most severe and longest haze episode in the past decade.

In one of his Instagram videos, Lutfi addressed Minister for Sustainability and the Environment Grace Fu directly and called on the authorities to investigate businesses and decision-makers based here if evidence links them to the fires.

He questioned whether Singapore would take action against influential business owners and corporate groups, aside from issuing notices to companies operating in Indonesia.

Called for scrutiny of corporate headquarters, Singapore links to concession land fires

Lutfi’s remarks on Singapore were in response to the National Environment Agency (NEA)'s announcement on Oct. 16 that it would issue Preventive Measure Notices to seven companies in Indonesia under the Transboundary Haze Pollution Act.

NEA's investigations found that the recent haze experienced in Singapore originated from fires on land owned by these seven companies.

Lutfi claimed that four of the seven companies were suppliers to conglomerates with substantial corporate holdings and listings in Singapore.

He also cited an investigative report by Greenpeace which linked Singapore-listed palm oil companies First Resources and Bumitama Agri to plantation areas in Indonesia where fires and smoke were detected.

He said that Singapore should scrutinise these connections when investigating the haze, and asked whether the government would pursue these Singapore-based decision-makers.

Pointing out that Singapore has no jurisdiction in Indonesia, he urged the authorities to prosecute the corporate headquarters here.

“Prosecute their headquarters in Singapore and show us what Singapore is really made of,” he said.

Singapore investigating companies in Singapore linked to land concessions

As of Oct 19, Singapore's NEA has issued Preventive Measure Notices to 10 companies in Indonesia whose concession land fires might have cause haze that affected Singapore.

These companies are: PT Bumi Andalas Perms, PT Bumi Mekar Hijau, PT Paramitra Mulia Langgeng, PT Sumatera Alam Anugerah, PT SBA Wood Industries, PT Hutan Lestari Raya, PT Bangkanesia, PT Buana Megatama Jaya, PT Mananjung Hayak, and PT Baratama Putra Perkasa.

The Preventive Measure Notices, issued under the Transboundary Haze Pollution Act, require the companies to deploy firefighting personnel, discontinue or refrain from burning activities, and submit plans to extinguish fires or prevent their recurrence.

Beyond this, Singapore has taken steps to look into the corporate groups and decision-makers that control these companies.

Speaking to the media in on Oct. 19, Fu said that Singapore would investigate the companies’ business connections locally and overseas, including their shareholders, customers and subsidiaries.

At the same doorstop, Senior Minister K Shanmugam had this to say about the Singapore-listed companies linked to the land concessions:

"Companies cannot play hide and seek with different corporate structures. Nor should they hope that because the evidence and actions are in Indonesia, they can escape responsibility in Singapore."

Shanmugam also gave examples of the levers that Singapore is using to investigate these companies.

SGX has questioned seven agri-companies listed in Singapore on their operations and possible links to the haze.

Banks have also questioned companies with agricultural operations on their potential links to the fires, and assessing the risks that arise from "environmental and legal issues".

Affirming that Singapore's actions are "aligned with the broad policies as announced by the Indonesian administration under President Prabowo", Shanmugam said that the steps taken by Prabowo to tackle the haze issue are "unprecedented".

Exchange of words between Lutfi and Syed Saddiq

In another video, Lutfi also hit back at Malaysian MP and former youth minister Syed Saddiq's suggestion for ASEAN to exert diplomatic and financial pressure on Indonesia over the recurring haze, arguing that Malaysian plantation companies and their financiers should also be held accountable for the haze.

Responding, Syed said he supported action against any company proven to have started fires, whether Malaysian, Indonesian or Singaporean.

“I will not shield polluters, even those from my own country,” he said:

"In my own Parliament, I have already called for action against Malaysian companies involved. Watch my full speech. Don’t edit it in a way that distorts the truth."

Trade minister replaced after palm oil corruption scandal

This isn't the first time Lutfi waded into controversy.

During his term as trade minister under then-president Joko “Jokowi” Widodo from December 2020 to June 2022, Lutfi was embroiled in a high profile economic corruption case involving palm oil exports.

The case concerned export approvals issued during a domestic cooking oil shortage in 2022 that caused prices to surge.

Investigations revealed that the Director-General of Foreign Trade within Lutfi's ministry illegally issued export permits to companies that had not fulfilled domestic supply requirements.

A series of policy reversals by Lutfi led to a complete export ban which sent the domestic price of palm fruits plunging 70 per cent.

While Lutfi blamed a "palm oil mafia", he was replaced by Jokowi in a cabinet reshuffle in June 2022.

Lutfi's ongoing allegations against Singapore

The latest in Lutfi’s string of claims against Singapore includes allegations that GIC and Temasek pressured MSCI to threaten to downgrade Indonesia’s stock market status, triggering panic selling so they could buy Indonesian assets at lower prices.

Lutfi has not provided any evidence to support his claims. Both GIC and Temasek have since denied the allegations.