New Research: European Jobs & Exports at Risk if the EU Restricts Palm Oil Biofuels

Kuala Lumpur (11 June 2018) – Today, the Malaysian Palm Oil Council (MPOC) released new economic research that quantifies the negative impact to major European economies should the EU move ahead with proposed restrictions on Palm Oil biofuels under the Renewable Energy Directive (RED).

The research finds that almost €40 billion of EU exports and over 350,000 jobs across Europe depend on trade with Palm Oil-producing countries.

Today, EU Energy Ministers are meeting in Luxembourg to discuss a new French Government proposal that would impose a freeze on Palm Oil biofuels under the RED. Such discrimination could lead to negative trade consequences for both Malaysia and for major EU exporters.

The economic research was carried out by the renowned Danish consultancy, Copenhagen Economics (CE). CE is a long-time consultant to the European Commission on a vast array of economic and scientific topics.

Key findings of the new report:

  • At least 354,000 EU jobs are dependent on trade with Malaysia, Indonesia and Thailand.
  • €39.5 billion of EU exports across key industrial sectors are dependent on trade with Malaysia, Indonesia and Thailand.
  • Up to 18,000 EU jobs are at risk from trade retaliation if the ban on Palm Oil biofuels comes into place
  • Germany could lose up to 5,640 jobs and €626 million in exports if the ban on Palm Oil biofuels comes into place
  • UK could lose up to 1,752 jobs and €194 million in exports if the ban on Palm Oil biofuels comes into place
  • France could lose up to 2,787 jobs and €309 million in exports if the ban on Palm Oil biofuels comes into place
  • Italy could lose up to 1,737 jobs and €193 million in exports if the ban on Palm Oil biofuels comes into place
  • Spain could lose up to 785 jobs and €87 million in exports if the ban on Palm Oil biofuels comes into place

The following statement can be attributed to Martin H. Thelle, Managing Director and Partner at Copenhagen Economics:

“It is clear that significant jobs and exports earnings across the EU are dependent on trade with Malaysia, Indonesia, and Thailand. Europe’s trade with Malaysia, Indonesia and Thailand accounts for €39.5 billion in exports, supporting at least 354,000 jobs in the EU. Any reduction in trade could have a significant impact on key export sectors including aircraft, automobiles, pharmaceuticals, and electronics. The countries most dependent on trade with Malaysia, Indonesia and Thailand are Germany, France, U.K., Italy and Netherlands. A reduction in trade of 2 billion EUR could impact 18,000 jobs across Europe that are dependent on this trading relationship.”

Dato’ Haji Aliasak Haji Ambia, President, National Association of Smallholders (NASH) Malaysia stated:

“Any EU ban or cap on Palm Oil biofuels is a discriminatory action against the hundreds of thousands of small farmers across Malaysia. The Governments of France and Italy promised that there would not be discriminatory treatment against Palm Oil. Those promises must be honoured. Attempts to camouflage this discrimination behind technical calculations are deceitful. Europe is now adopting Trump-like trade tactics that violate WTO rules. The EU cannot credibly claim to be a defender of global trade if this discrimination against Palm Oil is adopted.”

To read the report and learn more, visit here.