THE European Union’s (EU) latest move to ban oil palm-based biofuels by 2021 is a potential violation of the World Trade Organisation’s (WTO) rules, International Trade and Industry Minister  Mustapa Mohamed said.

Malaysia will intensify collaboration with other palm oil producing countries to consider more concerted efforts to voice its concern before the various committees under the WTO, he said. 

“More immediately, we will raise this issue at the Committee on Sanitary and Phytosanitary and Committee on Technical Barriers to Trade in March and Committee on Market Access in April 2018,” he said today.

At the same time, the International Trade and Industry Ministry is chairing a meeting of technical experts of the Friends of Palm Oil in Geneva to assess the possible impact from this latest development and explore further counter measures and actions.

“Our outreach efforts will also be enhanced to clarify the misperception related to Malaysian palm oil and these will include various lecture series, as well as WTO informal dialogue on this issue in the coming months.

“Malaysia is also seeking a comprehensive solution for the discriminatory treatment to palm oil-based biofuels compared to other crop based biofuels through the Malaysia-EU FTA (MEUFTA) negotiations, which we hope to relaunch sometime this year, as well as the proposed ASEAN-EU FTA,” Mustapa said.

MITI will continue to work closely with the Ministry of Plantation Industries and Commodities to ramp up its engagement with the EU countries, he said.

Mustapa said this latest development is discriminatory against palm oil producing countries. 

“It is also a regressive step which will fuel further uncertainty surrounding global trade. As more and more countries around the world embrace protectionism, many had hoped that the EU will provide the necessary leadership role to uphold the principles of free and fair trade,” he said.

For small trading nations such as Malaysia, this is a worrying development which together with the unfair labelling practices by the private sector in the EU member states, will adversely affect the livelihood of over 650,000 Malaysian oil palm smallholders.

“I urge the European private sector to be fair and not to be influenced by the vote in the European Parliament and the negative sentiment against our palm oil. Facts must prevail above unsubstantiated claims in this matter,” Mustapa said.

Malaysia is the world’s second largest exporter of palm oil, and in 2016, 15.2% of the country’s total exports of palm oil worth RM10.3 billion went to the EU. – Bernama, January 22, 2018.