Indonesia, Malaysia unite against EU palm oil discrimination law

Indonesian President Joko Widodo has urged for stronger cooperation with Malaysia to combat perceived discrimination against their palm oil products, as new European Union legislation threatens to impact exports. The EU enacted a law earlier this year prohibiting the import of commodities linked to deforestation, which is expected to adversely affect the palm oil industry.

Indonesia and Malaysia are the leading global producers and exporters of palm oil, a versatile commodity found in products ranging from cosmetics to food items. Following a meeting with Malaysian Prime Minister Anwar Ibrahim in Kuala Lumpur, President Widodo, commonly known as Jokowi, emphasised the need for collaboration to prevent discrimination against their commodities in other countries.

In a joint statement, both leaders pledged to work closely together to address the EU’s “highly detrimental discriminatory measures against palm oil.” They called for the EU to promptly pursue a fair and equitable resolution. The two nations, which together contribute to approximately 85% of worldwide palm oil exports, recently sent a joint delegation to Brussels. High-ranking government officials from both countries met with EU leaders to discuss the deforestation law.

Malaysia has labelled the law as “unjust” and is coordinating with Indonesia to determine an appropriate response. Additionally, Jokowi announced that the countries have agreed to establish a framework to safeguard the rights of migrant workers.

In recent years, Malaysia has faced numerous allegations regarding its treatment of migrant workers, who form the foundation of its manufacturing and service industries. Several Malaysian companies have been banned in the United States due to the use of “forced labour.” Indonesia is the primary source of foreign labour for Malaysia, with many Indonesians employed in palm oil plantations.