Malaysia and Indonesia join forces against EU’s ban on palm oil

Malaysia Prime Minister Tun Dr Mahathir Mohamad and Indonesia President Joko Widodo issued a joint letter to the European Union (EU) over its plan to ban crude palm oil (CPO) from being used in raw materials for bio-fuels by 2030.

The move came after European Commission deemed palm oil as an unsustainable product because its cultivation resulted in excessive deforestation from the years 2008 to 2015, thus destroying the habitats of several endangered species.

Indonesia however denied the allegation by stating that the country’s growers have applied a sustainable and eco-friendly way of cultivating the commodity.

Previously, Tun Mahathir said that the EU’s unfair and discriminative policies against palm oil risks a trade war with Malaysia.

In addition, Malaysia and Indonesia, which account for a combined 85 per cent of global palm oil supply, have threatened to boycott EU products, as can be seen by recent difficulties faced by SpiritsEurope in its attempt to export drinks to Indonesia.

The two aligned countries have also threatened to bring the dispute to the World Trade Organization (WTO) to ensure that the ban is fair and not a mere discriminatory act.