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Jakarta Post

2019: Tackling palm oil disputes, challenges

  • Made Anthony Iswara

    The Jakarta Post

PREMIUM
Denpasar, Bali   /   Thu, December 26, 2019   /  04:38 pm
The Jakarta Post Image
Coordinating Economic Minister Airlangga Hartarto (second left) appears with Malaysian Primary Industries Minister Theresa Kok (center) during a press briefing on Nov. 18, 2019 at the Ministerial Meeting of Palm Oil Producing Countries in Kuala Lumpur. (The Jakata Post/Adrian Wail Akhlas)

Indonesia’s palm oil sector has been embroiled in disputes over palm oil with the European Union for most of 2019, characterized by tit-for-tat trade spats, tariffs and lawsuits amid the government’s efforts to empower smallholder oil palm farmers. Palm oil is one of Indonesia’s top foreign exchange earners and contributes 1.5 to 2.5 percent to gross domestic product (GDP). But the commodity has faced growing restrictions overseas in recent years, especially in the EU – Indonesia’s second largest buyer in 2018. The commodity has been linked to environmental degradation, particularly deforestation, but Indonesia has interpreted the measure as a protectionist move for locally produced vegetable oils like soybean oil and sunflower oil. In June 2018, the European Parliament decided on a 32 percent renewable energy target, under which it intended to phas...