What the Critics Don't Understand

The palm oil industry has been much in the news lately over allegations about its effects on wildlife habitats and the region’s ecological health.

Much of the conversation has been marred by misconceptions and outright falsehoods emanating from activist groups based in Europe. As the Roundtable for Sustainable Palm Oil meets this week in Kuala Lumpur to discuss the present and future of the industry, an honest assessment of the industry and its impact on the economy and environment is in order.

The palm oil industry has emerged as a critically important source of economic vitality for Malaysia and the broader region over the past two decades. And it is important to understand what has been driving this growth.

We produce an excellent product and should not apologise for that fact. Palm oil has turned out to be a versatile and valuable vegetable oil. In many respects, it is the single best vegetable oil on the global market. It is used as a cooking oil throughout Asia, as a food ingredient in the global processed food trade and as a biofuel powering transport systems across the planet. It is because of the enormous value added to consumers – and, as we will see in a moment, to the planet itself – that palm oil has become so much in demand.

In the process, this growth in the palm oil industry has provided badly needed jobs to many parts of the developing world, from Asia to Africa to Latin America. In Malaysia alone, the palm oil industry directly accounts for close to half a million jobs. The resultant tax revenues fill the public’s coffers and sustain our infrastructure and education systems.

Palm oil is one of many natural endowments in this part of the world – others include cocoa, coconuts, rubber, sugar – the cultivation of which has made it possible for nations to generate an aspirational middle class, the backbone of all economically self-sufficient societies.

None of these facts is appreciated by our critics who come from wealthy developed countries and have no sense of the genuine challenges facing the developing world. Instead, they focus on the potential risks and problems attendant to natural resource harvesting. So let’s look at Malaysia’s record in historical context.

Throughout their history, many European nations plundered their natural resources, such as forest lands. They gave no thought at the time to the long-term consequences of their rapid exploitation.

Indeed, this short-sightedness drove their colonial period. As they exhausted their domestic resources, they travelled the world, uninvited, looking to exploit the natural endowments of other nations.

Europeans badly overharvested their lands, and their forests and other natural endowments have never fully recovered from that earlier period.

Contrast this history with Malaysia’s. As the commercial palm oil sector developed, industry teamed up with policymakers to ensure that Malaysia’s natural endowments would be respected while permitting the nation to harness the economic value of its resources for the benefit of the public. As a result, Malaysia has put 50 per cent of its land off-limits to commercial harvesting. This is a policy that takes the prudent long view, and it is one we wholeheartedly support.

In addition, the industry has partnered with government to ensure that the commercial harvesting that takes place limits the impact on the broader ecosystem and wildlife habitats.

Of special concern are Malaysian orang-utans who live and thrive in our forest lands. One reason for setting such a large percentage of the country’s natural habitat off-limits – a percentage that is by orders of magnitude larger than any European nation – is to protect orang-utans and many other species of wildlife. And so industry and government have worked hand in glove to protect orang-utans with a variety of special protection programmes.

There is an irony to the anti-palm-oil campaigns that have been launched by a small group of activist organisations in London and northern Europe. In some respects, palm oil is the greenest of all the world’s vegetable oils. Its caloric density is much higher than corn, soya or rapeseed oil, meaning it has more nutritional bang for your buck than alternatives. This means its relative ecological footprint is smaller.

What’s more, as a transport fuel, it is far more energy-efficient than its global competitors, especially ethanol and rapeseed oil. This, too, means that its ecological footprint is smaller on a relative basis than other offerings.

As the world desperately seeks a way beyond the era of carbon-rich, dirty fuels – particularly coal and petroleum that were used by Europeans to power their economic rise – vegetable oils from Asia have emerged as an important part of the planet’s fuel mix. So it is unfortunate and somewhat odd that Europeans – who bear a large measure of responsibility for the carbon crisis the world confronts today – would demonise the greenest of all the vegetable oils on the market. Why have they not demonised corn and rapeseed oil as well? Perhaps it is because that is what their nations produce domestically.

From almost its very beginning, the palm oil industry has laboured to produce environmentally responsible and sustainable palm oil, even willing to see the prices of its products rise in the marketplace as a result (sometimes to the point of alienating customers). But activist groups continue to move the goal lines, making new demands that will do little to actually help the environment. Meanwhile, the myriad benefits of sustainable palm oil, which I have only barely touched on here, are ignored by these same critics. They can’t have it both ways.

The palm oil industry provides jobs and incomes to those who need it; satisfies consumer demand for quality cooking and food ingredients; and is powering a greener energy future across the planet. If only all industries, or activist groups, could boast such achievements, the world would be a better place.

Tan Sri Dr Yusof Basiron is chief executive officer of the Malaysian Palm Oil Council.


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