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Jakarta Post

2019: Tackling palm oil disputes, challenges

  • Made Anthony Iswara

    The Jakarta Post

Denpasar   /   Fri, December 27 2019   /  12:19 am

Indonesia’s palm oil sector has been embroiled in disputes 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 phase out palm oil biodiesels by 2030. The Europea...