Halal Industry 

Palm oil discrimination makes it difficult to conclude Malaysia-EU FTAs

| 14 March, 2019
 Ooi Tee Ching

MARCH 14, 2019 | 8:15PM MYT | KUALA LUMPUR

Malaysia is not likely to conclude free trade agreement (FTA) talks with the European Union (EU) and European Free Trade Association (Efta) if palm oil continues to be discriminated with tariff and technical trade barriers.

Yesterday the European Commission, the executive arm of the EU, announced it will table a delegated act to phase out palm oil in the coming European Parliament sitting in April 2019.

When asked to respond, Ministry of International Trade and Industry (Miti) deputy-secretary general (trade) Datuk Seri Norazman Ayob said, "if there is no green light for palm oil into Europe, it is very difficult to conclude the FTAs (with the EU and Efta)."

The Efta; made up of 4-member countries Switzerland, Liechtenstein, Norway and Iceland and the 28-member EU have been courting Malaysia to revive FTA talks that have stalled for several years.

Norazman confirmed that Miti has filed a complaint to the World Trade Organisation (WTO) on palm oil being discriminated in Europe.

This issue has been brought up at WTO committee meetings on trade & environment and technical trade barriers.

"This issue is of great concern to us. We've brought it up at WTO committee meetings. It's an ongoing process.

“We put forward our case that our palm oil is sustainably produced as reflected by the Malaysian Sustainable Palm Oil (MSPO) certification, just like the Indonesia Sustainable Palm Oil (ISPO)," he said.

Norazman was speaking to the media after Miti minister Datuk Darell Leiking officiated at Malaysian Investment Development Authority (Mida) performance briefing here today.

Last year, Ambassador and head of EU delegations to Malaysia Maria Castillo Fernandez had expressed interests to revive the EU-Malaysia FTA talks. It was initiated in 2010 but set aside in 2012.

In December 2018, Norway Parliament announced ban on palm biodiesel imports by January 2020, driving a potential wedge into revival of FTA talks. Malaysia’s last round of trade negotiations with Efta was in May 2017.

Primary Industries Minister Teresa Kok had reportedly said Norway's move is hurting trade relations between Malaysia and Efta.

Last month, during his visit here, Norway Trade minister Torbjorn Roe Isaksen played down trade tension when he said he is “hopeful and positive” that the next round of Efta negotiations may start soon.

He said this in the light that on December 16, 2018, Indonesia had concluded FTA talks with Efta.

After eight years of negotiations, Indonesia was able to conclude with Efta on its own terms. Indonesia and Efta's agreement allows for sustainably-managed forest resources and vegetable oils.

Indonesian palm oil gets full market access into Iceland and Norway, with an exception of palm products for animal feed other than for fish.

Malaysia's palm oil for use as fuel, however, continues to be discriminated and face prospects of being phased out, throughout Europe.

Copyright New Straits Times

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