Kuala Lumpur (AFP)
Malaysia will lodge a complaint with the World Trade Organization (WTO) against the European Union plan to remove palm oil from European biofuels by 2030, the Malaysian minister in charge of the dossier said Tuesday.
"Malaysia will lodge a complaint with the WTO, we hope to do it by November," Teresa Kok, the Malaysian minister in charge of the sector, told AFP.
This Southeast Asian country is the world's second largest producer of palm oil after Indonesia and would be severely penalized by this measure. The services of the Minister of Justice are working on drafting the complaint and Malaysia looks forward to cooperating with Indonesia on this issue.
Indonesian President Joko Widodo said on Friday that he intends to fight this European project, which he accuses of "discrimination", while palm oil is a "strategic raw material" for his country.
In March, Malaysian Prime Minister Mahathir Mohamad criticized the EU's willingness to reduce the share of palm oil in biofuels to zero in 2030, ensuring that this would trigger a trade dispute.
He also threatened retaliation, saying the country could eventually buy Chinese fighter planes instead of French Rafale or Eurofighter Typhoon.
Indonesia and Malaysia, which produce some 85% of the world's palm oil, have protested strongly against the European Union after the publication in March of a European regulatory text.
The effect of the text is to classify palm oil in unsustainable biofuels because of its effect on deforestation and climate change. The two major exporting countries fear that their markets will narrow after a 15% drop in the price of this raw material last year.
© 2019 AFP