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Jakarta Post

Indonesia, Malaysia prepare to contest EU’s RED II CPO policy

  • News Desk

    The Jakarta Post

Jakarta   /   Mon, March 25, 2019   /   05:33 pm
Indonesia, Malaysia prepare to contest EU’s RED II CPO policy President Joko “Jokowi” Widodo plants a young oil palm to kick off a tree replanting program in Musi Banyuasin regency, South Sumatra, on Oct. 13, 2018. (Courtesy of/The Indonesian Palm Oil Association ( GAPKI) )

Indonesia and Malaysia will likely make a separate move against the European Union policy against palm oil through a delegated regulation supplementing directive of the EU Renewable Energy Directive II (RED II), which is now being deliberated by the European Parliament, a trade official has said.

“We will wait for our partner, Malaysia, such as which law firm will be assigned. We have to complement each other,” said the Trade Ministry's international trade director general, Oke Nurwan, in Jakarta on Monday as quoted by kontan.co.id.

The European Parliament on Monday kicked off the session, which will deliberate the EU Renewable Energy Directive II submitted by the European Commission on March 13. If the RED II is approved, the EU will categorize palm oil as an unsustainable product and phase out its use in biofuels in 2030.

The Foreign Ministry's special staffer for prioritized program acceleration, Peter F. Gonta, said the government was still waiting for the European Parliament’s decision.

“The session could produce a ban [on palm oil] or the parliament will delay the decision to April 15, or it would wait for the election of the new parliament. We still don’t know. We will find out within the next three days,” Peter added.

House of Representatives Speaker Bambang Soesatyo reportedly joined the diplomatic force by sending a letter to the European Parliament, calling on it to reject the RED II draft.

Indonesia takes the issue seriously and will take it to the World Trade Organization if the EU approves the draft, Oke said, adding Indonesia could make a separate litigation move or collaborate with Malaysia.

Indonesia is the largest crude palm oil (CPO) producing country, while Malaysia is the second.  

Indonesian exports to the EU were recorded at US$17.1 billion in 2018, while imports were at $14.1 billion. Investment from EU countries to Indonesia stood at $3.2 billion in 2017. (bbn)