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Tensions between EU and South East Asia over EU legislation deemed to ‘increase poverty’

The Council, Commission and European Parliament are currently finalising new EU legislation on mandatory due diligence to stop deforestation in supply chains.  In September, the European Parliament already voted to substantially tighten up the European Commission’s original proposal, which entails requiring companies to check whether goods sold in the EU have not been produced on deforested or degraded land anywhere in the world.

Quite a few analysts expect political agreement on the Regulation to be announced before the U.N. Biodiversity Conference (COP15), which will take place in Montreal from December 7 to 19.

The new rules will drastically restrict palm oil imports, which will ‘increase poverty’, according the Indonesian Palm Oil Association (IPOA/GAPKI).

Commentators have called the new legislation “protectionist”, noting “how it mainly hurts emerging economies like Indonesia, Malaysia and Papua New Guinea. Noteworthy is also how the EU Commission’s original proposal simply exempted rubber imports from the new requirements, which is unlikely to be unrelated to the EU’s high demand for rubber, which happens to be the main cause of deforestation in West and Central Africa.”

Opponents have also pointed at research by the think tank Chain Reaction Research (CRR), which has concluded that palm oil deforestation in Indonesia, Malaysia and Papua New Guinea has fallen to its lowest level since 2017.

Furthermore, a study by researchers at the University of Bath, published in Nature, has demonstrated that a ban on palm oil may just worsen deforestation, as alternatives like sunflower or rapeseed oil require more land, water and fertilisers.

Meanwhile, DW reports that “Malaysia’s new Prime Minister Anwar Ibrahim (picture) is seen as a reformist willing to work with the West.  But his affinity for Europe will be put to the test over an ongoing dispute with Brussels over palm oil.”

World Trade Organization (WTO) challenges have been launched against other EU legislation by Indonesia and Malaysia, the world’s two largest palm oil producers, which call it “discriminatory”, as Malaysia’s Plantation Industries and Commodities Minister Zuraida Kamaruddin even called it “crop apartheid.”


Picture: Anwar Ibrahim (Prime Minister of Malaysia). Copyright: By United States Embassy Kuala Lumpur – Ambassador Kamala meeting with Dato' Seri Anwar Ibrahim, Public Domain,