The Oil Palm The Oil Palm

ICYMI: Palm Oil & EU Trade – Malaysian Government Sets Out Its Position

The EU is facing questions this week about plans to ban Palm Oil biofuels, and other discriminatory restrictions placed on the Palm Oil sector.

Minister Datuk Seri Mah Siew Keong, Malaysian Minister of Plantation Industries and Commodities, sent a clear message in an opinion editorial published in Euractiv. Read the Minister’s full op-ed online here.

Also this week – EU Commissioner for Agriculture, Phil Hogan, was questioned by reporters in Brussels, asking if the EU risks a ‘trade war’ with Malaysia and Indonesia as a result of the ENVI Committee vote against Palm Oil biofuels. Video is here (from 08:30).

The Minister’s op-ed states clearly that the EU’s approach to Palm Oil is undermining trade and cooperation. The Minister writes:

“In Brussels, calling for a ban on palm oil may be seen as a quaint pet project of a few MEPs. In Malaysia, it is seen as an existential threat to families and livelihoods.

“The recent Environment Committee vote on the RED has confirmed suspicions. In addition to the ban on palm oil biofuels, MEPs chose to discriminate against advanced palm biomass on approved EU lists; and to game calculations of GHG emissions to favour European-grown oilseeds.

“This overall approach to palm oil is a strategic error: the short-term agenda of the vocal minority is being placed ahead of the long-term interest of the European Union in the South-East Asian region.

“EU leaders would do well to recall that trade is a two-way street. Palm oil exported from Malaysia today passes many high-value European exports travelling in the other direction. Aircraft and aircraft parts, electronics, foodstuffs, and professional services from across the EU are booming in Malaysia, creating jobs and enhancing growth for EU countries.”

Read the Minister’s full op-ed online here.

As a reminder, the EU’s current regulatory actions on Palm Oil include –

  1. The EU Parliament’s Environment Committee voted to exclude all Palm Oil biofuels from the EU’s renewable energy market as part of the EU’s legally-binding Renewable Energy Directive (RED).
  2. The ENVI Committee also voted under the RED Directive to exclude advanced Palm Oil biomass from the EU’s advanced renewable energy strategy.
  3. The EU Commission has proposed, as part of the RED, giving Member States power to restrict the use of oilseed crops as biofuels. The French Government has already announced its intention to ban Palm Oil biofuels – other countries may follow suit.
  4. The European Food Safety Authority (EFSA) has proposed new food regulations targeted at Palm Oil, which have now been voted on by the EU’s Standing Committee. These could come into place – as binding EU rules – in 2018.