MALAYSIA AND INDONESIA IN PACT TO TACKLE PALM OIL ISSUES

By Ahmad Fuad Yahya

JAKARTA, March 6 (Bernama) -- Six bodies representing palm oil producers and
exporters from Malaysia and Indonesia have agreed to cooperate to jointly tackle
issues related to palm oil, particularly those raised by non-governmental
organisations (NGOs).

The effort was formalised under a memorandum of cooperation signed yesterday
by the Malaysian Palm Oil Producers Association (MPOA), Indonesia Palm Oil
Association, Association of Palm Investors from Malaysia and Indonesia (APIMI),
Sarawak Oil Palm Owners Association, Federal Land Development Authority (Felda),
and Indonesia Oil Palm Smallholders Association.

The signing of the agreement was witnessed by Malaysia's Plantation
Industries and Commodities Minister Bernard Dompok and Indonesia's Agriculture
Minister Suswono.

MPOA chief executive officer Mamat Salleh said Malaysia and Indonesia
should work together in overcoming the challenges being faced by the industry at
the Roundtable on Sustainable Palm Oil (RSPO), in negotiations on trade
regulations with the European Union and the United States, and at the
International Panel on Climate Change.

"The issues being faced and should be tackled carefully include those on
sustainability, biodiversity, greenhouse gas emission, and carbon stock in
forests and peatlands which cannot be touched even for the people's
development," he said.

Mamat said at the same time, the two countries should be cautious towards
new issues which might arise such as indirect land use change and border carbon
tax.

Another issue which is expected to emerge in the long term is the focus on
water sources and supply in the form of water footprint which can make oil palm
cultivation controversial, he said.

At a press conference, Dompok said that Malaysia and Indonesia, which
contributed 85 per cent of the CPO in the international market, were entitled to
cooperate to protect the interests of the palm oil industry.

He said with the cooperation, the producers involved could carry out
programmes to present correct information on the palm oil industry in the two
countries as well their efforts in preserving the environment.

"In the past, the NGOs questioned the health aspect of palm oil but their
allegations had been countered by Malaysia and Indonesia with proven evidence,"
Dompok said.

"Now they are using the environment issue. We are a responsible member of
the world community, there is no reason for us to destroy the very place that we
live," he said.

Susowono said Malaysia and Indonesia, responsible for 85 per cent of the
world's CPO production, should also determine the commodity price in the
international market, which was presently decided in Rotterdam.

"The cooperation (between Malaysia and Indonesia) will help to tackle the
negative issues relating to the palm oil industry," he said, adding that
Indonesia has not expanded the area for oil palm cultivation.

He also hoped that Indonesia could increase its productivity in CPO
production which was still low compared to Malaysia.

Currently, Indonesia is producing 20 million tonnes of CPO from 7.9 million
hectares of oil palm plantations compared to 16 million tonnes of CPO from 4.7
million hectares in Malaysia.

This is due to the lower productivity of Indonesian smallholders who are
managing 3.0 million hectares of oil palm.
-- BERNAMA