Indonesia and Malaysia deploy ministers to push back on EU restrictions on palm oil

JAKARTA Senior officials from Indonesia and Malaysia, the world’s largest palm oil producers, will meet European Union policymakers in Brussels amid a diplomatic standoff over a new deforestation rule that threatens to close the product out of the EU market.

The rule, formally adopted by the EU on May 16, prohibits trade within the bloc in products and goods linked to deforestation and forest degradation, in a bid to protect forests globally. To be able to enter the EU market, growers would need to provide verifiable information that their products were not grown on deforested land after 2020.

Palm oil is one of many products subject to the rule, officially called the European No Deforestation Regulation (EUDR), alongside beef, soy, cocoa and others. It is a ubiquitous ingredient in processed foods, cosmetics and biodiesel, the production of which has long been associated with the wholesale clearing of tropical rainforests, the burning of peatlands, the destruction of endangered wildlife habitats, land disputes with indigenous and traditional communities and labor rights violations.

The governments of Indonesia and Malaysia, which together account for around 85% of global palm oil exports, have criticized the regulations, calling them discriminatory against palm oil because their requirements are too stringent to so that producers, especially smallholders, can follow them.

During a bilateral meeting with European Commission President Ursula von der Leyen in Japan on May 21, Indonesian President Joko Widodo voiced his objections, saying Indonesia’s deforestation rate for 2019-20 had fallen to its lowest level since 1990 and was still falling.

To discuss the regulations and their implications on the palm oil industry in both countries, Indonesian Economy Minister Airlangga Hartarto and Malaysian Commodities Minister Fadillah Yusof will hold meetings with the European Commission and the European Parliament in Brussels from May 30 to 31.

We would like to point out that the EU regulation on deforestation weighs on small farmers because they must follow the administrative producers as required by law, Airlangga said in A declaration. This, he said, could exclude smallholders from the global supply chain.

The meetings will therefore focus on ways to minimize the negative impacts of the regulations, especially on small-scale farmers, he added.

EU policymakers deny claims that the new regulation is disproportionately harsh on palm oil to protect the EU’s internal market for oilseeds, including olive oil and coconut oil. rapeseed, which face fierce competition from palm oil. They say the law also applies to commodities produced anywhere and that sustainable palm oil can still enter the market, provided it meets the requirements.

EU Ambassador to Malaysia Michalis Rokas said the new regulations will not affect Malaysian smallholders grouped under the government’s federal land agency, FELDA. Indeed, FELDA smallholders have not cleared any forest to establish new plantations since 1990, well before the deadline of the 2020 laws.

The EUDR is purely an environmental law because the EU wants to contribute to the fight against climate change and the preservation of forests, Rokas said as quoted by local media. These are very fair regulations with regard to the Sustainable Development Goals and the eight products listed have been chosen following scientific studies.

Indonesia and Malaysia have worked together on lobbying to support their respective palm oil industries against what they call a product-targeted smear campaign. In 2015, the two countries established the Council of Palm Oil Producing Countries (CPOPC), an intergovernmental organization to promote the global use of palm oil.Palm oil.

In 2021, President Widodo called for enhanced cooperation with Malaysia to tackle what he called palm oil discrimination.

Banner image: Oil palm plantations in Malaysia. Image by Rhett A. Butler/Mongabay.

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