EU palm-oil enrages SE Asia exporters

EU palm-oil enrages SE Asia exporters

The world’s two dominant palm-oil producers, Indonesia and Malaysia, have condemned MEPs for backing a ban on the product’s use in biofuels.

A Malaysian minister called the European Parliament approved measure protectionist and a form of “crop apartheid”.

Parliamentarians approved draft measures to reform the power market and reduce energy consumption in an attempt to meet the 2015 Paris climate agreements.

The measure includes a ban on using palm oil, which is also used in lipsticks, ice creams and numerous other products, as motor fuel after 2021.

Indonesia and Malaysia together produce nearly 90 per cent of the global supply of palm oil with a large portion of European imports used to manufacture biofuels.

And there were fears in Malaysia that others could follow suit.

“Europe is considered a trend setter,” warned Malaysia’s Palm Oil Board director general Ahmad Kushairi Din. “People will start shying away from it.”

Malaysia has threatened to cut of trade ties with nations that reduce palm-oil consumption and last year it warned that it was reviewing its trade with France in response to a law limiting the use of palm oil in biofuels.

“This vote is very disappointing. It’s a black day for free trade. You are discriminating against palm oil,” Malaysia’s minister of plantations Mah Siew Keong told the media.

By allowing other vegetable oils to be used in biofuels, the EU was targeting palm oil, he alleged.

Earlier this week, hundreds of Malaysian small palm planters marched on the EU’s mission in Kuala Lumpur to hand over a petition against the biofuel ban.

The EU, which accounted for 12 per cent of overseas palm-oil shipments, is Malaysia’s second-largest market for the commodity, after India.

Indonesia’s trade minister Enggartiasto Lukita said there should be fair treatment for all vegetable oils, adding that the government had challenged the EU’s “negative campaign” on palm oil on several previous occasions.

Palm-oil producers have been blamed by EU activists for deforestation. But nothing has been decided at this stage with the European Parliament, European Commission (the EU’s executive branch) and member states needing to agree on the measures before they become law.

Mah said Malaysian ambassadors in all 28 EU members would raise objections and the government would work closely with Jakarta to protect exports.

“The government will not tolerate the denigration of the palm-oil industry and will ensure Malaysia gives a fitting response to those who harm the palm-oil industry,” Mah told the media. “The EU is practising a form of crop apartheid.”

 

Palm-oil production in Malaysia. Picture credit: Pixabay

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