Govt to file complaint over EU’s biofuel mandate

Minister to attend the CPOPC meeting with Indonesia today, aims to lodge complaint by November

by SHAHEERA AZNAM SHAH / pic by TMR FILE

THE government expects to lodge a complaint against the European Union’s (EU) classification of palm oil cultivation to the World Trade Organisation (WTO) as early as November.

Primary Industries Minister Teresa Kok (picture) said the ministry has filed a complaint to the Attorney General’s Chambers (AGC) and is waiting for the chamber to assist in finding experts to lead the case.

“We are pursuing the complaint to the WTO. In fact, the documents are now with the AGC.

“I hope to file the complaint before we meet with the EU again in November.

“My ministry has already discussed with the AGC and they are assisting us to identify experts who can argue the case for,” she told reporters at the ninth International 2019 Planters Conference in Kuala Lumpur yesterday.

Kok added that she will be attending the Council of Palm Oil Producing Countries’ (CPOPC) ministerial meeting with Indonesia today to continue discussing retaliatory moves against the EU’s stance to curb palm oil usage in biofuel within the bloc.

“I will meet our Indonesian counterpart to hear what their stance is on filing a WTO complaint and what are their proposals.

“If they do not want to participate, we will most likely go alone. But it would be strategically good for both countries to unite in this matter,” she said.

Last Friday, Indonesian President Joko Widodo vowed that he is on board to defend palm oil against the bloc’s biofuel curb as the mandate will likely affect 16 million Indonesian farmers or 6% of the country’s population.

Redefining the oil palm cultivation activities which have been classified by the EU as high-risk is among the agendas at Malaysia’s next meeting with the European Parliament.

The meeting is expected to take place latest by November this year.

The European Commission has adopted the Delegated Act proposal to implement the EU Renewable Energy Directive for 2021-2030, which will gradually limit and phase out biofuel imports into the bloc until 2030.

The regulation suggests that oil palm cultivation contributes to deforestation, greenhouse gas emissions and indirect land use change, classifying it as a “high-risk” activity.

Currently, about 36% of the total 5.85 million ha of oil palm plantation areas in the country are certified as Malaysian Sustainable Palm Oil.

Malaysia and Indonesia are the world’s top producers of the commodity, supplying about 85% of global demand.

The EU countries are the second-largest buyers for both countries after India, as Europe currently consumes 7.5 million tonnes of palm oil a year — about 10% to 15% of the global palm oil demand.

Meanwhile, Human Resources Minister M Kulasegaran said the moratorium on the recruitment of Bangladeshi workers is expected to be lifted by September this year.

“We are in the final stage to conclude lifting the moratorium for labour supply from Bangladesh, which is expected in one or two months’ time.

“We want a mechanism that ensures the workers leave the country upon completion of their contracts.

“The mechanism is being drawn up and we are addressing other options like exploitation of workers and agency fees,” he said.

Kulasegaran added that lifting up the moratorium could substantially ease the shortage of foreign workers in the plantation sector which had cost planters billions of ringgit.

Previously, Kulasegaran said the plantation industry lost nearly RM10 billion a year due to unharvested fruits.