No halt on Malaysia, Indonesia EU trade talks over palm oil, says Malaysian minister
NEITHER Indonesia nor Malaysia have halted talks on their respective free trade agreements (FTA) with the European Union (EU) over a dispute about a deforestation law and its impact on small palm oil producers, Malaysia’s commodities minister said.
Malaysia’s negotiations on a possible EU FTA, which have been on hold since 2012, could be resumed if the EU would treat Malaysia with fairness and as a partner, Fadillah Yusof told reporters in Brussels on Thursday (Jun 1). He added that Indonesia had been negotiating for seven years with the EU and was “very patient” about waiting longer.
Fadillah was responding to a news report which said the talks were being frozen over the palm oil issue.
Indonesia’s economic ministry and trade ministry did not immediately respond to Reuters’ requests for comment.
The Financial Times (FT) had reported on Wednesday that Indonesia and Malaysia will delay trade talks with the EU while they seek fairer treatment for small palm oil producers.
Fadillah, who is also Deputy Prime Minister of Malaysia, said the EU’s recently adopted law banning the import of products that come from land cleared of forests was “punitive and unfair treatment towards us and to smallholders in particular”, according to the FT report.
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Also in the report, Indonesia’s Coordinating Minister for Economic Affairs Airlangga Hartarto said the policy favoured “large corporations or multinationals” which could afford the level of bureaucracy that the regulation will demand.
Indonesia and Malaysia earlier this month sent top officials to the EU to voice concern over the deforestation law, which they believe could be detrimental to small farming businesses.
The two countries are the world’s biggest palm oil producers and account for about 85 per cent of global palm oil exports. The EU is their third-largest market.
The EU’s landmark deforestation law would also ban imports into the bloc of coffee, beef, soya and other commodities, unless companies can provide “verifiable” information to show the products were not grown on land that was deforested after 2020.
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