Move to Have WTO’s Ear on Palm Oil Fight

Malaysia and Indonesia may file a complaint to the

World Trade Organisation to protect the growth of the oil palm industry

that supports tens of millions of livelihoods

Malaysia and Indonesia may file a complaint to the World Trade

Organisation (WTO) over protectionist measures, disguised as

environmental concerns and imposed by developed nations and activist

groups, against the oil palm industry.

“I’ll be in Indonesia

later this month. Although non-tarriff trade barriers are not on the

official agenda, I will explore this topic with my counterpart,”

Plantation Industries and Commodities Minister Tan Sri Bernard Dompok


“We need to find out more about the legal definition of

‘trade barriers’. We need to be sure what constitutes a substantive

complaint before we make a joint decision,” he told reporters after

opening the Indonesia-Malaysia Palm Oil Meeting in Kuching, Sarawak,


One such law in Europe that blatantly discriminates

against the import of palm oil is the European Union (EU) renewable

energy directive.

The directive seeks to restrict the import of palm oil for biofuel use

in Europe in favour of the heavily subsidised home-grown rapeseed oil.

Adopted last year, the directive will take effect at the end of this

year, which means member states must draft their laws based on it.

Dompok’s views echoed that of former prime minister Tun Dr Mahathir

Mohamad, who, six months ago at the 2009 Malaysia-Indonesia Economic

Seminar, had called on leaders of both countries to be more vocal in

their stand at international forums.

“If both Indonesia and

Malaysia speak out with one voice, it will be more effective. This way,

both countries will earn the respect of others,” he said.


to the press conference, Dr Lulie Melling, director of the Tropical

Peat Research Laboratory Unit at the Sarawak Chief Minister’s

Department, presented her studies on peat agriculture.

As early

as 2005, findings on greenhouse gas emission from oil palm planting on

tropical peat-land published in peer-reviewed environmental scientific

journals, “Tellus” and “Soil Biology Biochemistry”, indicated that the

planting of oil palm trees on peat soil was not as polluting as largely


Oil palm trees planted on peat soil actually emit

less carbon dioxide than those in old forests as there are less fresh

litter and root biomass for microbes to feed on and contribute to


Also present at yesterday’s event were

representatives from the Malaysian Palm Oil Association (MPOA),

Indonesian Palm Oil Association, or Gapki, Association of Plantation

Investors of Malaysia in Indonesia, Sarawak Oil Palm Plantation Owners

Association (Soppoa), Felda Group, Malaysian Estate Owners Association,

and East Malaysia Planters Association.

Soppoa chairman Datuk

Hamed Sepawi, in addressing the 200-strong crowd of planters and

government officials, highlighted that the oil palm industry is a

national economic security crop for both Malaysia and Indonesia.

“The trees are planted by tens of millions of oil palm growers in both

countries. At the same time, this nutritious edible oil feeds billions

of people in China, India and other developing nations. The future

growth of the oil palm industry is in Sarawak and Indonesia,” he said.

In the last two years, Malaysia earned between RM50 billion and RM65

billion a year from palm oil exports. The industry also constitutes up

to one-third the value of Malaysia’s gross domestic product.

Malaysia’s RM65 billion annual palm oil exports support some two million

jobs and livelihoods along the sprawling palm oil value chain.

The Malaysian Palm Oil Board’s data also show that more than 330,000

smallholder families, working on 1.6 million hectares, produce a quarter

of the nation’s palm oil exports.

Gapki leader Purboyo Guritno

concurred with Hamed. The Indonesian Palm Oil Commission indicated that

the republic earns US$10 billion (RM32 billion) annually from palm oil


“Indonesia and Malaysia must take a more proactive

approach in protecting the growth of the oil palm industry that supports

tens of millions of livelihoods,” he said.

Purboyo said that

oil palm planters had long been victimised and discriminated by trade

barriers disguised as environmental protection, levied by developed

nations like those in the EU and green activists.

“We need to

find ways to improve the collation and dissemination of scientific data

on peat agriculture and greenhouse gas emissions so that everybody can

better distinguish facts from false claims,” he said.

Source : Business Times

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