MALAYSIA’S total exports in 2018 expanded by 6.7% to reach a value of RM998 billion, compared with RM935 billion in 2017. The growth was largely contributed to by the electrical & electronic sectors, which contributed 38.2% or RM380.8 billion, rising by 11% in 2018.
Other manufactured products also contributed to the growth in export for 2018 such as chemicals and non-metallic minerals products which grew by 22.5% and 21% respectively.
While almost all sectors shows the positive growth in export for 2018, the export value of palm oil and palm oil based products shrank drastically from RM54.02 billion in 2017 to RM44.70 billion in 2018.
The slump happened due to many reasons. The decisive action by European Union countries to ban palm oil and the huge expansion of palm oil plantations in Indonesia created lower demand and an oversupply of such products worldwide.
The government, through the Primary Industries Ministry, Miti, and Wisma Putra is currently struggling hard to curb the headwind by clarifying the misperception on palm oil created by anti-palm oil campaigns and rolling out the B10 biodiesel programme nationwide to help stabilise palm oil prices.
Nevertheless, such efforts are not enough as it is quite difficult to improve the global demand and price of palm oil without a strong pact and mutual understanding among palm oil exporters.
Even though the Council of Palm Oil Producing Countries was set up in 2015 to safeguard the interest of palm oil producing countries, new policies need to be developed and enforced by the council to address those aforementioned issues wisely.
This includes regulating the price and production of palm oil as well as monitoring the expansion of palm oil plantation to ensure the stabilisation of palm oil markets in order to secure an efficient, economic, and regular supply of palm oil to consumers globally. In addition, critical issues regarding deforestation and the United Nations’ Sustainable Development Goals should be taken into account as well to ensure the palm oil industry will remain relevant and resilient.
Since Malaysia was appointed as a chairman for CPOPC this year, it is hoped that we can raise our voices and highlight this matter seriously to the council during the next meeting to be held on February 28 in Jakarta. – February 3, 2019.
* Ahmad Shahir Abdul Aziz reads The Malaysian Insight.
* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight.