JUSTICE FOR PALM OIL SMALLHOLDERS
It is time for the Europeans to be more consultative and collaborative
OUR quest to secure justice for Malaysian palm oil smallholders is unfaltering.
A few weeks back, between June 12 and 15, I led a special palm oil mission to Strasbourg, France, and Rome, Italy, to further the interest of our palm oil industry in general and our smallholders in specific.
In Strasbourg, which is the seat of the European Parliament, I engaged with influential European Union (EU) Commissioners and EU Members of Parliament (MEPs), including the EU Commissioner of Environment, Maritime Affairs and Fisheries, Karmenu Vella, and Chairman of Industry, Research and Energy Committee, MEP Jerzy Buzek.
Separate roundtable discussions were also conducted with key palm oil stakeholders in Europe, including European Palm Oil Alliance (EPOA), European Sustainable Palm Oil Advocacy Group (ESPOAG) and the International Sustainability and Carbon Certificate (ISCC).
In Rome, I led roundtable meetings with Ferrero; the renowned Italian producer of branded chocolate spread and confectionery products and the Italian Alliance of Sustainable Palm Oil (IASPO), as well as bilateral meetings with Barbara Degani, Undersecretary of Environment, and Ivan Scalfarotto, Undersecretary of Ministry of Economic Development.
The European paradox
The mission was punctuated by two contrasting developments. On one hand, the European Parliament on April 4 this year voted 640 to 18, with 28 abstentions, to introduce a single certification scheme for palm oil entering the EU market and phase out the use of palm oil biodiesel by 2020.
While I was in Strasbourg, I received further unfortunate news that the Norwegian Parliament voted to ban the public procurement and use of palm oil-based biofuels on June 13.
On the other hand, the Belgian Court of Appeal ruled on June 2 that the Belgian supermarket chain, Delhaize, was misleading its customers by making wild and inaccurate environmental and health-related allegations against palm oil and the court said the allegations were “unverifiable, unsubstantiated by fact-based claims and therefore, not objective”.
The latter is a welcomed victory for the palm oil industry and finally justice for the palm oil industry that continues to be unfairly, and in some cases such as the Delhaize instance, illegally maligned in Europe.
Be that as it may, the threat to the industry remains clear and present with the European Parliament resolution going through its due process and the spillover effect from the Norwegian ban.
Non-tariff barriers contrary to Malaysia-EU FTA
EU is a significant trade partner to Malaysia. Bilateral trade in 2016 was recorded at RM149.1bil (10% of total trade) with exports and imports standing at RM79.8bil and RM69.2bil, respectively.
These exports include palm oil products worth RM10.3bil or 12.9% of total exports to the EU in 2016.
The EU is not only a large export market for Malaysia but is a trendsetter when it comes to palm oil products because of its influence.
The proposed Malaysia-EU Free Trade Agreement is expected to be concluded by the end 2017 and it is critical for both sides to adhere to the letter and spirit of the common goal for open, free and sustainable trade.
Unilateral, unfair and sometimes illegal non-tariff barriers such as the European and Norwegian Parliament resolutions and the Delhaize case fly in the face of the bilateral trade growth that both sides are seeking and the precepts of free and fair trade.
All about deforestation
In the case of the Norwegian Parliament resolution against palm oil-based biofuels, it once again hinges on the unsubstantiated allegations of deforestation.
Just to recap a point I elaborated extensively in my previous article, livestock farming remains the biggest culprit when it comes to greenhouse gas emissions.
At 3.45 billion hectares, pasture makes up 69% of global agriculture land, which stands at five billion hectares. In comparison, oil palm hectarage stands at 18.87 million hectares, or 0.38% of global agriculture land.
And Malaysia’s oil palm footprint is merely 0.11% of global agriculture land at 5.74 million hectares.
A report by the Rainforest Foundation Norway that seems to justify the Norwegian Parliament’s action points to carbon dioxide emission allegedly caused by palm oil cultivation.
Yet, it failed to recognise that methane produced by livestock, primarily cows, is roughly 30 times more potent as a heat-trapping gas compared to carbon dioxide, making it one of the main culprits of global warming.
What makes the Norwegian action harder to swallow is the fact that while it is held as a leading proponent of environmental protection, its forest cover as a ratio to land area is less than half of Malaysia, based on 2015 World Bank data.
It is clear that we need to redouble our efforts to address this European threat to the palm oil industry.
Specific programmes are needed to further augment our environmental protection efforts while targeted and precise communications must be amplified to educate, inform and win over the detractors as well as the European public, the ultimate consumers.
Rather than imposing a single unilateral standard on us, the European Parliament should work with us towards accepting the Malaysian Sustainable Palm Oil (MSPO) certification.
The fact that the MSPO is no longer a voluntary certification scheme but a mandatory one by the end of 2019 speaks volumes of our seriousness in best agriculture practices and sustainability in palm oil farming and production.
I am willing to engage non-government organisations on certification and sustainability but my only condition is that they must be honest brokers and keep an open mind and heart when it comes to palm oil.
I have also had numerous consultations with my Indonesian counterpart and via the Council for Palm Oil Producing Countries (CPOPC), a concerted and conjoined approach will be taken to counter this unprovoked attack on palm oil.
Collectively, Malaysia and Indonesia account for 86% of global palm oil production and our combined strength in countering the negative campaign against palm oil will be much more effective.
Malaysia has been transparent and proactive and it is time for the Europeans to be more consultative, collaborative and empathetic.
We will continue to seek justice for our 644,522 palm oil smallholders. Datuk Seri Mah Siew Keong is Minister of Plantation Industries and Commodities. Commodities Today and Beyond is his op- ed to share his views, hope and vision for commodities with everyday Malaysians.